Traditional consumer credit and lenders such as banks generally need ensure certain factors are met before issuing credit. The two main ones are:
A Way to get the Borrowed Money Back
A Reasonably Good Idea that the Borrower is Likely to Reply the Money
Both of the Above
In traditional financial systems, a person’s credit score is derived from data about their past behavior, which helps predict future behavior. This approach to credit scoring thus creates both a prediction and an enforcement mechanism.
This score however, does not work in the messy crypto world out there. You need something different to both predict and enforce repayment, and this is where companies like Graychain come in.
Blockchain anonymity and the ability to transact peer-to-peer changes the dynamics completely. We need companies that approach the credit data problem differently than traditional credit bureaus. These companies need to consider anonymity, pseudonymity, and the global, trans-national, nature of blockchains, in addition to using alternative behavioral data.
Come join Graychain on May 23rd, 2019, to learn about this alternative crypto credit scoring model that is changing crypto credit and the future of borrowing.