DeFi Meets Universal Basic Income With Just-Launched Project From eToro
eToro's GoodDollar initiative will provide a universal basic income for some of the world's poorest by incentivizing people to yield farm on its platform.
Sep 8, 2020 at 3:15 p.m. UTC:format(webp)/cloudfront-us-east-1.images.arcpublishing.com/coindesk/SODBJ7BBINCJFN2O4E5JAPAIMQ.jpg)
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Multi-asset brokerage platform eToro has begun a new initiative that uses yield farming to hand out free crypto-backed stablecoins, apparently in a bid to promote financial inclusion.
- Called GoodDollar, the project will create and issue a stablecoin ($G) that can be distributed daily to registered users as a form of universal basic income (UBI).
- At launch, each $G token will be backed by dai (DAI) stablecoins, although the plan is to diversify collateral so that each stablecoin is backed by a basket of cryptocurrencies.
- The UBI model is sustained by supporters who deposit underlying assets onto the platform and then yield farm on supported decentralized finance (DeFi) protocols, like Compound or Aave.
- Some of the accrued interest is then handed back to supporters, with the rest used as collateral for new $G tokens that are distributed each day.
- GoodDollar is a non-profit funded by donations from eToro. An app and wallet have been released alongside the announcement on Tuesday.
- Per the announcement, GoodDollar says hundreds of new wallets have been created in countries like South Africa and Nigeria, as well as Venezuela.
- An eToro spokesperson told CoinDesk that “over 100,000 G$ have been distributed to over 250 users” during the course of a two-week trial.
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