Credit Swap
Credit Swap helps people buy homes in crypto via peer to peer credit swaps!
Project Description
Meet Credit Swap
Today, many of us have crypto and want to purcahse real estate - but we don’t qualify for traditional loans because banks disregard crypto assets.
Credit Swap is a peer to peer platform that helps people partner with proxy buyers who take loans and buy homes on your behalf: then issue a credit swap!
How Does It Work?
An Asset Holder (person with crypto) identifies a huse they want to buy. They post a Credit Swap Request for this house: asking potential Proxy Buyers (a person with good access to lines of credit at banks) if they’re wiling to take out a loan and buy the property on behalf of the Asset Holder.
Proxy Buyers review requests. They select one to fulfill: they take out a loan and buy the house.
A “Credit Swap” is issued between the Proxy Buyer ad the Asset Holder via the Platform:
- a contract says the Proxy Buyer is offering a private loan to the Asset Holder, which he must pay back over a defined time period
- The Asset Holder pays back the loan over time - when the pay-off is complete, the Asset Holder is transfered the property rights
The effective result of this is the Asset Holder got a loan at the rate of the Proxy Buyer, with a slight markup.
The Proxy Buyer earned his markup, and the Asset Holder gets his house!
Note on the legal side: the Credit Swap platform maintains a trust that is the signatory for legal deals: this allows…
- Multiple Asset Holders to pool funds and buy one property: allowing people with less money to be able to get real estate exposure
- Asset Holders do not have to dox themselves to do legal transactions, because the trust is the signatory
How it's Made
Yellow: State channels for our auction bidding system for proposals: Proxy Buyers send proposals, Asset Holders negotiate. Asset Holders put their funds in state channels, paid out to the chosen Proxy Buyer.
vLayer: Verification that a loan has been taken out by a Proxy Bidder is performed using vLayer web proofs and bank login (with Revolute). Verifications are then submitted for review.
Flow: Application logic, final credit swap settlement, and requests resolution happens on Flow via the Credit Swap smart contracts. Yellow state channels also deployed on Flow.
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