Ripio Video Paper: Sebastian Serrano & Luciana Gruszeczka exclusive interview


ripio has established itself to fulfill
the demand for credit both for those who
don’t have access to it and also to
compete with the interest rates and
banking fees of traditional credit
markets globally the vast majority of
people do not have access to credit and
many of those same people don’t have
bank accounts by creating an ERC20
token and smart contracts on the
Ethereum network they’ve devised an
incentive structure which is a complete
solution for providing credit to anybody
from the lender to the borrower to the
co-signer participants transact in their
RCN token but fiat currency is provided
to the end user
who doesn’t necessarily know that their
loan is backed by crypto after receiving
VC funding from Tim Draper among others
they then raised 68 million dollars in
their token sale they reached over a
hundred and fifty thousand registered
users in early 2018
Crypto Crusades travel to the financial
district of Buenos Aires to speak to
Sebastian the founder and the CEO of
Ripio and Luciana the compliance officer
I started coding at 8 and I’m from a small town in Patagonia I am a pharmacist but I’ve
been working in technology since the
last maybe 10 years also my first job
was teaching internet so I’ve been in
contact with technology since I was
young so before Ripio we were working
together in a consulting firm doing
software development and then 2012 – beginning of 2013 I saw Bitcoin
the for the first time and it was kind
of like a deja vu with the internet it’s
like the internet again but for value
and at the time there were currency
controls in Argentina it was very
difficult for here for us to charge
clients abroad we got excited and we
decided to start working on this and it
was clear that the first thing that had
to be done was to help people get access
to the to the network
what was the inspiration for this particular
project we were working with other
payment processors before within our
consulting firm and so on an initial
approach we say okay well this will help
people charge clients abroad at that
time that was very difficult because of the
capital control then after a year of
just doing payment processing we
realized like there was no no one paying
in Bitcoin we got a lot of people paying
our merchants using credit cards on
traditional forms of payment on our
merchants
did convert a lot to Bitcoin at that
time and we had the issue that we have
more people selling Bitcoin locally than
people buying it and we decided well
we’re missing the other piece there is
no one building I would wallet so that’s
what inspired us to build the wallet and
to make it more broadly accessed and that
was the thing that started to grow more
and we shifted all our focus into the
wallet in the last few years so you went
from having – how did you go from providing a wallet running an ICO the wallet is
still the main product with the wallet
we built that first infrastructure layer
and then on top of the wallet we started
building more services that are using
the blockchain technology the first one
that we realized that was important or
that will benefit people is to start
building access to credit we initially
began just lending ourselves to our
users from the information that we have
on the wallet but it was always the idea
to build that product natively in the
blockchain RCN network that has a
token started as a thesis that what is
going to be the next phase is that
everything that was a contract before on
paper will become a smart contract
connecting lenders and borrowers
globally will reduce a lot of the
intermediation that is [there] right now and
give access to people to create a much
lower interest rate and for some people
just access to credit for the first time
so this product works when one of our
users get access to the trade service
from the wallet they can request an
amount of pesos from the wallet like a
traditional form like they would just
say
how many pesos they want and how much
interest rates they’re willing
to pay and what is happening on the on
the background is that we created a
small contract that represents the
application of requests for credit and
that gets published on the network and
then we have lenders all over the world
that can say well I will be willing to
lend a capital and then that can become
completely peer-to-peer and global at
the same time and there is a lot of
other challenges that were also solving
but we think like many of these things
are going to start emerging on top
of this technology and it will reduce
the cost to access the financial
services how far along are you before people are actually making loans to other people there
has been hundreds of loans already in
the network and our challenge now is
scale it more inside our user base we
have more than 200,000 users in review
and also star integrating other wallets
globally and more exchanges so that this
becomes a truly global and large network
we’re more concerned now on growing the
company regionally to cover more
countries we’re currently in Argentina, Brazil
we are about to launch in Mexico and
Colombia
when you were building that product did you have South American society in mind or
do you did you always want your product
to be you know used globally so what we
think is gonna be the best for the
network is – we can allow access to
credit from people from emerging markets that currently pay huge interest
rates and connect them with lenders that are
from developed countries that they get
low interest rates when they lend by
doing that and reducing the
cost of not only mediation also
transfer of capital globally which is
something that is very easy to do with
crypto then we can make something that
is a lot more beneficial for both
parties the lender and the borrower by
reducing cost we can also bring a lot
more people into the online economy if
you look at South America or Africa more
than half of the population doesn’t have
access to banking is through technology
we lower the cost to provide service we
can cover more people because we can
cover the cost of acquiring the user
make it efficient and economical
at the same time so what are your hopes for your projects
and other blockchain projects in South America what’s the ideal situation
what we will continue working – and hope more people join us – is that we
cover most of the population
to get access to the online economy so maybe people never who never got banked they are currently
considered unbanked maybe they never
banked and they just have a crypto wallet
there are many other projects that people
will build on blockchain thinking on
the needs of people and there’s going to be
a lot of innovation it’s a very
interesting time do you think that
Argentina in particular because of what
happened 2001 people are more open to new
technologies such as cryptocurrency such as blockchain
yeah I think so for example I’m 36 I saw
three economic collapses, two replacements
of the currency they completely changed
the name they stopped printing one money
and they started printing another one and
replaced the entire economy there are
so many times that so many bad cycles it
makes a lot more sense
the value proposition of Bitcoin
going from Argentina to someone from
from another country and I think it
shows for being such a small country
that is not like a known country for
unicorns [billion dollar companies] we do have a lot of blockchain
companies that are very important in the
space and in Buenos Aires I think
there are more than 30 startups that are
Bitcoin and blockchain related and some of
them are one of some of the most
important projects in the space because
because what you said generally people involved
in this ecosystem in South America in
Argentina are more
idealogical Argentinians know a lot about
value and how to move during
inflation because of all our our history
and that also reflects and why it’s
easier to get what this technology is
about value proposition of bitcoin of
being a store of value that is global
that has a fixed amount that’s going to be
issued saying like there’s never gonna be
more than 21 million bitcoins resonates a lot because our governments are
known for printing and printing just
finance itself by and
it’s a huge cost for the society so I
think it comes from that understanding
could either or both of you share a personal
experience from one of the three
episodes of inflation or financial
instability of Argentina
well I remember when I was very very
child is my family having to stop
buying stuff because they were one day
one price and the other day was the
double price I remember people on
streets and new currency that they
launched that was called Patacón when I
was a kid and the crisis in the 89
there was a not only inflation there was
hyperinflation so during the
hyperinflation prices will update during
the day people re-price things in the
same day so I remember that when my
father and mother they got paid they
they went immediately to buy things into
the stores and so when you got paid you
just rushed from the bank to the
supermarket just to buy groceries before
it deflated and also before
they
they run out of stock because many
people doing the same
what’s the incentive for somebody that’s
taken a loan on your network to pay it back the loans are unsecured the
initial ones not least the borrower when
they take the loan to do it in our
network they also in require a cosigner
the wallet will issue the smart
contract and right now that would that
is co-signed by us but it could be
other entities and the cosigner basically
what it’s doing is ensuring the
contract because they are a local entity
that can collect in case the the borrower
defaults as we’re building a global
network if we have a lender from South
Korea lending to an Argentinian and
the borrower in Argentina defaults
for someone in Asia will be very
difficult to collect like not only
because of it will cost a lot of money
also how all the knowledge to just how
to do it legally will be very difficult
but in every jurisdiction there are
companies that are already doing
collection that already are insurance
companies that know how to handle the
local risk so the cosigner charges a fee
to
sign together with a borrower if the
borrower defaults that cosigner pays the
loan to the lender and then is it owns
the loan and can go and collect to the
borrower so basically the lender
doesn’t have to assess each individual
borrower they only need to trust the
cosigner and that is just one entity to
evaluate when they when they are lending
and can be an institution that builds a
reputation how about in Venezuela is it difficult to have a remote subsidiary in Venezuela what’s the situation there we have like 12 people there
well the situation there for people is
sometimes very difficult as you
mentioned sometimes they have to work
from home because there are things that
are happening in the streets or like
that is not safe to go to the office or
or sometimes they they don’t go back to
their homes because of something so that
there are also things that get into the
reality what is nice about for them is
that we can pay really good salaries for
what an average person in Venezuela can
can make and they have a much better
situation that the average person in in
Caracas and there is no problem actually
paying people oh we’re paying them in crypto
are there other companies in Argentina or in South
America who are outsourcing from
Venezuela and paying them in
Bitcoin or crypto
I think we are one of the few
companies that are paying their staff in
bitcoin or crypto in Venezuela – what are you paying them in, is it bitcoin or an ERC20 token?
we are paying them in bitcoin right now but we are
considering switching to maybe a
privacy coin like C-cash or – does the fluctuating value of bitcoin
make it difficult for you and the people on the other side
their currency deflates so much on daily
basis that bitcoin is so much better
can you just describe what crypto kitties
was and how your experience was since
you were doing your ICO at the same time
so well the crypto kitties is the first uses massively of a token which is non-fungible
non-functional so they they created
these small characters that represent
kitties they these are all works of art
that each kitty has different
characteristics and paws and body
types and people can collect them and
you can breed them together and during
the weeks that it launched it really
exhausted all the capacity of the Ethereum
network and we were launching the first
loans at the same time so it was the network became very unreliable during that
time our initial version has many steps
from the origination to to lending to
the user and that required a lot of
transactions in the network do you have
any crypto kitties did you buy any crypto kitties for yourself I never no I never bought any
crypto kitties we do have funds in Decentraland what I know about crypto kitties
it is that you can also rise a new
crypto kitty if you have two crypto kitties
well that’s nice maybe that’s an idea for the wallet if you have two wallets it can create an extra wallet they can breed
but also maybe they can be also bad with some illness and kill all the crypto kitties i dont know
we we are fans of Decentraland which is another Argentinian
project and the company does have a
parcel in Decentraland so we will
eventually do something together
do you know the McAfee’s advertising your coin
yeah we saw him tweeting that it was we
didn’t even expect it so you’re happy about it
well I don’t know I’m happy about the mention but he’s a
very eccentric character so and we
didn’t even reach out to him yeah it’s
nice that there is a lot of really good
people backing our project and we have
people like Tim Draper backing the
company and other really well-known respected investors
why is it that Tim Draper invested in Ripio
when we started the company I
was in San Francisco and she was here I
hear that the son of Tim, Adam, who was
launching an accelerator so we were one
of the first companies to go into the
accelerator that was Bitcoin during that
time going through the accelerator the team the father of Adam went several times and talking he
became more important to us during the program after explaining a
lot why was important for Argentina he he
click on Bitcoin not only became one of
our investors he also got really excited
all about Bitcoin during that time
So you’re the reason that Tim Draper bought Bitcoin initially?
so he already knew about Bitcoin before
investing in us but he got really
excited with us and he well Tim says
is that he clicked on why it’s important
and then after that he bought a lot of Bitcoin
Yeah, how many has he got now
what we know is that he won the one of
the auctions from the government after
the from what it was
confiscated from silk road that is at
least sixteen thousand Bitcoin or
thirteen thousand something like that
and he bought them very cheap what do your families think about your project now my family is very excited about seeing myself in
the newspapers they asked me to not
be in the
crime section

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