Introduction

Abstract

The market

In 2019 the global lending market reached $6.8 trillion in size, of which $2.5 trillion (36.9%) is household lending. In addition, there are over 3.3 billion people without access to credit due to being credit invisible or thin-file. With the introduction of open banking (Plaid, Tink, Belvo) and credit scoring using alternative data (Pngme) new markets and segments can now be reached by traditional banks and fintech neo-lenders. Over the past twelve months, the growth of Decentralized Finance (DeFi) has been exponential. Today (November 2021), there are 3.9 million DeFi wallets and $104 billion in Total Value Locked (TVL) in the DeFi ecosystem; this is a 400% increase in the number of wallets and a 1000% increase in TVL in the last twelve months.

DeFi credit today

95% of the lending in DeFi is collateralized or overcollateralized when a person taking out a loan must post collateral in the form of Bitcoin (BTC) or Ethereum (ETH) to take out a loan at a given Loan to Value (LTV) ratio. To take DeFi mainstream un/undercollateralized lending should be accessible to creditworthy people looking for better credit terms than currently offered by banks.

Credit markets in the DeFi ecosystem are prevented from reaching mainstream lending markets due to the lack of critical credit infrastructure that can trustlessly measure and price risk in real-time for use in smart contracts and DeFi credit products. Further, there are currently barriers to collecting and reporting on loan defaults, making it impossible to enforce loan collections when borrowers default. By making credit infrastructure accessible to decentralized credit markets, DeFi platforms can launch a broader set of credit use cases to take DeFi mainstream, opening DeFi to a $2.5 trillion household lending market.

Uncollateralized lending has been the hard-to-achieve holy grail of the DeFi ecosystem since 2017 - Masa is the solution to enable mainstream adoption of lending in DeFi.

The future with the 🌽 Masa Protocol

Masa is a decentralized credit protocol that allows people to connect their traditional and cryptocurrency accounts - creating a decentralized credit report as a 'soulbound' NFT. With Masa, you can share your data privately to access the next generation of financial products.

Masa Finance provides a simple user experience through which people can link, manage, and track traditional and cryptocurrency accounts to create a non-fungible credit report - allowing access to credit through fully on-chain services.

Masa’s credit protocol comprises a decentralized credit bureau and embedded lending protocol consisting of a non-fungible credit report, composable credit primitives, smart contracts, and liquidity pools, enabling developers to launch sophisticated credit products in DeFi to match the existing centralized credit paradigm.

At launch, Masa supports over 10,000 data sources across 78 countries through traditional financial data integrations with Credit Bureaus, Banks, and Fintechs; aggregated together with global cryptocurrency coverage through exchange integrations, Masa unlocks a market of 2.97B people through its credit infrastructure.


What’s Next
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