Last year, cryptocurrency had mainstream media exposure because of Bitcoin. Who wouldn’t be surprised? From the price of $800 per Bitcoin just in December 2016, Bitcoin’s price increased to a whopping $16,000! Many people even predicted that Bitcoin will rally above $20,000. Actually they were right! The highest price of Bitcoin in December 2017 was $20,089. If you invested $1,000 in Bitcoin in December 2016, your initial investment then became at least $20,000 because that’s a 2000% increase from $800 to $16,000 in just a single year. Even the stock market with an annual average of 20% increase can’t compete with that.
Since Bitcoin sparked sudden curiosity from all kinds of people, technical and non-technical alike, all other alternative coins aka “altcoins” were also given the share of the limelight. Bitcoin is the most famous cryptocurrency while Ethereum and Litecoin are the most famous altcoins.
This year, an online lending platform powered by blockchain technology focusing first in Southeast Asia will rise to challenge the lending dominance of banks and even loan sharks. Its name is Hero. You may ask, what is a cryptocurrency mentioned above? Also, what is blockchain technology? Before we proceed further, I’ll briefly explain how banks use our money and I’ll also be having a short introduction about the concepts of blockchain technology and cryptocurrency for the sake of the newbies and non-technical ones.
The Banking System
Let’s start with banks. People deposit to banks so they can store their money away from theft and unexpected circumstances like floods, earthquakes, and other calamities. Banks give interests on your deposits but their interests are very low. The amounts you entrust to banks are being used for the Stock Market, Foreign Exchange, loans (housing, car, personal, etc.), insurance, and other forms of investments.
Banks get their profits there which they give back as interests. For most people, it’s a hassle-free investment because you just put your money in banks and earn interests. If we analyze further, there are problems arising from this kind of scenario.
Privacy and Identity Issues
Before we even open an account, banks ask us to submit documents as requirements. The examples of these documents are employment records, proofs of income, and national identification cards like Passports and Driver’s License. Since they’ll be having our identification documents, it’s not hard to think that they may have the tendency of using our documents for malicious activities.
Centralized Entity
A bank is a very good example of a centralized entity. They have our money and they also have our identity. What do you think will happen if there comes a hacking incident to that bank and we have a deposit there? Yes, every government has their own insurance policies on these kinds of instances but it will take a very long time, even months before that incident will have a resolution. The resolution may not even be favorable to the depositors.
Powerless Depositors
Since banks are centralized, the power is not being upheld by the people. If banks want to impose higher interest rates, they can always do it. They can always impose higher penalties than usual on late payments of mortgages. Our money is with them but we don’t have full control with it.
Blockchain Technology
To have a quick info, treat blockchain as an interconnection of all computers around the world. You just run a program and everyone will be interconnected. Blockchain is a distributed ledger wherein all interconnected computers in that blockchain have all the information and transactions of that blockchain. Computers doing the transaction of a blockchain are called “miners”. The primary objective of miners is to handle and update the transactions of everyone in the blockchain.
Cryptocurrency
There are two kinds of cryptocurrency: coins and tokens. Coins can be mined while tokens can’t be mined. In a specific blockchain lies a single kind of coin or token unless it’s based from another blockchain such as Ethereum. People in that blockchain are the ones dictating the price of the coin or token through trading of that cryptocurrency.
To earn profits, traders apply their technical analysis on the charts to make an estimated guess about a cryptocurrency so they can buy low and sell high. Because of blockchain technologies and cryptocurrencies, the three primary problems by using banks were solved. How?
Since blockchain is about decentralization, there will no more central entity that handles your money and even your identity because blockchain is the interconnection of all the computers in the world. You’re fully private again because you don’t need to give your identity documents to the banks anymore. Even though there may still be hacking issues, it would then be almost impossible because you need to update everyone in the blockchain for the hacking.
To date, there are already around 2,000 coins and tokens available in the world of cryptocurrencies but during my recent research, there now comes an online lending platform to challenge the dominance of banks and even loan sharks to give loan opportunities to the unbanked and underbanked.
Hero to make lending easy for everyone
Based from the whitepaper of Hero, it wants to disrupt the lending ecosystem by introducing a lending platform for all the parties involved such as the borrowers, heroes, originators, servicers, payment providers, legal counsel, and vultures. Hero wants to make loans readily available for the unbanked and underbanked. Unbanked pertains to people who are not serviced by banks because they prefer pawnshops and other forms of credit options like loan sharks or even their friends. Underbanked pertains to an area with a vast population but very few banks to service the people. Hero plans to focus first in the region of Southeast Asia mainly the Philippines, Indonesia, Vietnam, and Thailand.
Hero wants to make the transaction of borrowing as hassle-free as possible to the borrowers. They also want to give the assurance to the lenders (known in Hero’s platform as heroes) that they will be paid by the borrowers by giving them the service providers (originators, servicers, payment Providers, and legal counsel) and vultures. For more information about the different parties, you can read their whitepaper at the following link:
https://s3-ap-southeast-1.amazonaws.com/herotoken/Hero+Whitepaper_111617.pdf
In my opinion, Hero has a future to have widespread use not only in Southeast Asia but also in the world. Why? Because not only Hero is powered by the blockchain technology, it also has the features of a lending platform while being more secured, decentralized, and the power of information are fully handled by the users and not by the banks.
Since I mentioned in this article the main goal of traders to buy low and sell on a higher price, Hero is giving us a very good opportunity.
Currently, Hero is holding their initial coin offering. The price of their Hero Token (Hero) is 0.005 Ethereum per Hero. That is around $4.68 per Hero at current Ethereum price of $937.16 as of this writing. Their public crowd sale will end on February 28. Also as of this writing, Hero already sold almost $37,000,000 worth of tokens.
To know more about Hero and its underlying technology, just visit their website at https://herotoken.io/ and start by reading their white paper.
Disclaimer: This is not an investment advice. Invest at your own risk. Invest only the amount you can afford to lose.
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Website: https://herotoken.io/
Bitcointalk Announcement: https://bitcointalk.org/index.php?topic=2088817
Whitepaper:
https://s3-ap-southeast-1.amazonaws.com/herotoken/Hero+Whitepaper_111617.pdf
Facebook: https://www.facebook.com/HeroTokenIO/
Twitter: https://twitter.com/HeroTokenIO
Telegram: https://t.me/Herotokensale
Author: https://bitcointalk.org/index.php?action=profile;u=1767289