The original creators of Bitcoin always dreamed that the currency may be used to alleviate global access problems in the financial sector. In addition to avoiding the fees which preclude third-world market participants from contributing to innovative efforts, the decentralized and public nature of blockchain technology lends itself to many applications in the sector of global financial transactions and banking.
Additionally, adoption by the public governmental sector has been a goal of innovators in the community for quite some time. One major area of interest has been in the use of cryptocurrency technology to facilitate the spread of foreign aid from one country to another. The benefits of such a system would be indispensable to the process itself.
Decentralized currencies fed straight into wallets and then quickly converted to fiat currency could alleviate several concerns innate to delivering aid to groups within conflict or in deeply-impoverished third-world countries. Because of the political conflicts often involved in these transactions, the money is often lost, manipulated, or outright stolen by adversaries to the target group.
Luckily, blockchain startup Bifrӧst. Bifrӧst is the result of a partnership between major players MakerDAO and Dether. It functions as an expedited cryptocurrency to fiat currency transfer method with a clear direction to help facilitate aid donations to conflict areas all around the world. The project is still under development, but is beginning to reach the pilot stage in select areas in Asia and the Middle East.
This creative solution gives speculators and humanitarians alike a lot to look forward to for the future of the blockchain in public policy and in philanthropic affairs. The integration of sophisticated public ledger technology to provide secure aid which completely bypasses existing power structures in the target country is both a promising and, to many, a dangerous concept.
A New Partnership
The partnership between ConsenSys Social Impact and MakerDAO is a much-needed pairing in the long-term development of Bifrӧst. The two companies, in many ways, provide to diverse backgrounds and offer something unique to the ongoing partnership.
ConsenSys is the first of several companies helping to fund the newly-created project. As the name might suggest, their primary focus is on incentivizing the creation of blockchain technologies which have a great propensity for us for the public good. Additionally, the company is charged with creating the funding process from the user side. They plan to use peer-to-peer value transfers and smart contract technology to place the funds in the hands of MakerDAO and Dether, who will then put the funds in the hands of the desired recipients.
MakerDao created Dai, a “stablecoin” which relies on the value of the United States Dollar. By contrast, Dether functions as a mobile application that helps to connect individual groups in need of aid with businesses with exchange capabilities, which allows the aid groups to more effectively reach out for funding from foreign supporters.
The combination of efforts will have a distinct benefit to the user. In addition to lowering transaction fees significantly, from 10+% to a measly 1%, the partnership is projected to make the delivery of dunds more efficient and quick.