Over the past decade, there have been many wonderful developments in the blockchain space, improving blockchain technology and its implication on our financial system. With the development of faster, cheaper, and more efficient blockchains, there has never been a better time to start using blockchain for real-world applications, which is precisely what the Acumen protocol plans to do. Throughout much of the world, there has been an ever-increasing disparity between the haves and the haves not, and a sharp decrease in social mobility: it has become very hard for people to move up the socio-economic ladder. We believe that blockchain technology solves these problems and can help democratize access to capital, making finance more inclusive. For the next couple of months, the Acumen protocol will be analyzing and building a platform to empower citizens in developing nations to take out microloans through the Acumen protocol. By leveraging Solana infrastructure, the Acumen protocol can make microloans possible because of Solana’s cheap and fast transaction speeds/costs, which for the first time has made micro-loans economically possible. One of the main reasons this wasn’t possible on other blockchains like Ethereum is the rising costs of gas fees, which can make microloans too expensive and frankly non-feasible.
Many places came to mind when choosing a test case; however, we believe El Salvador is the best place to start, as the core team is based in Latin America and they have recently embraced blockchain and similar technologies.
To make this possible, Acumen will release an Acumen Stable Dapp, where users can deposit assets and earn a stable interest. These deposits will be used to finance people’s access to capital in developing countries. One of the major injustices in the financial system is that access to capital isn’t decentralized. It’s very hard for people in these countries to take out loans, unlike people in developed nations, where you can go to the bank and apply for a loan. The fact is that the Banks in these countries have been around for hundreds of years and still haven’t made a change, a change that we believe is possible by leveraging our protocol’s technology and Solana’s blockchain.
When money is deposited into the Acumen stable DAPP, the funds will be converted into fiat and then lent out to people in need of capital in El Salvador. There are, however, some limitations; at the inception of the Acumen Stable DAPP, the only assets you will be able to deposit are stable coins, as there is no risk of price appreciation when the money is converted into fiat. In the Future, Acumen would want to support assets like SOL, SRM,STEP, etc., but need a hedge to ensure that users receive the correct amount back. The second limitation is that once you deposit money into the Stable DAPP, you will be able to choose a lockup period, which will vary in the APY. Once the money is deposited into the DAPP, it will be deployed across different lending markets in El Salvador, where third-party entities will deploy the capital and lend it out. The Acumen protocol will NOT handle lending out the money. Since this will all be done off-chain, the third-party entities will be audited monthly to ensure that loans are repaid, and capital returned. In the Future, the DAO will be able also to audit the third-party entities and revoke their privilege to deploy more money, or if the entity is performing well, increase the amount of capital they can deploy.
We believe that this is a fundamental problem that needs to be fixed, and we are happy to be the first to attempt to fix one of the world’s major injustices and help make a financial system that is more inclusive to all. We are happy to embark on this journey and thank you for your continued support, and we hope that you join us on our mission to make finance more equitable for all!
Acumen is a DeFi lending and borrowing protocol built natively on the Solana blockchain. Acumen was built by a team of leading global developers interested in expanding the Solana ecosystem. We look forward to actively developing and improving Acumen for years to come!