Nice.

Nice post fraind...

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neoxian is doing a great work on steemit everyone loving that :)

Well, the thing with money is it is really debt.  All debt.

You, as an individual, cannot make money with a positive value.  What you can make is a thing, that someone else wants.

So, you have a cow, and butcher it, and since it is way more than you could eat before it rots, you share it with your friends.  Now, they have a debt of obligation to you, and will likely share their chicken, hog or corn harvest.

If there was some money, they would probably give you some for the cow that you gave them.  It represents a debt that got passed.

So, it is all debt.  But loans, those are just waiting to be block-chain-ized

Without someone or something to reinforce the agreement I find it very hard to imagine how it would work. Trust on the internet is a very delicate thing :)

Hi Kevin, 

I think credit based tokens are still a grey area now. This is because it will be difficult to determine how these credit contracts will be resolved when default occurs. 

I think what SALT lending resolves this problem by holding your cryptocurrency as collateral and gives you fiat for that cryptocurrency which I think is really clever. 

I think there is a limitations for credit tokens protocols for now, as enforcing these contracts and enacting punishment on parties that do not honor the contract is really difficult.

I do not know enough to give mt opinion but this was a good read.

Your post often gives me a good mental workout. As for this post I have a hard time to find where I stand. 

I don't honestly think I completely get it. You still owe money right, and someone still wants it to be paid back, so what is the advantage of tokenizing debt ? 

Is the interest rate to pay back lower ?

Hi @Kevinwong,

I'm New to Steem, but fundamentally can't Steem be used as a way to fund credit? 

Think about it:
1. We have Steem Dollar - which is ideal for lending out to account holder.
2. We have reputation, can't they create another Credit-Reputation for the Steem account holder. The higher the credit-Reputation the lower the interest, etc.
3. This will create a need to produce more Steem Dollar....and also Steem. 
4. This will increase demand of Steem, raising prices, attracting investors
5. This will allow Steem to be used as MicroFinancing DAPP to small business projects around the world. And blogging and success of repaid loan will generate more Steem??? 

Ok...Not sure about the last one. But the point is why do we need ETH, is it possible to implement a simple pure credit / loan and customized system using Steem....with CreditWitness to set Rates etc?

Any thoughts on this?


![](http://www.investmentpostcards.com/wp-content/uploads/2010/08/Credit-Card-Cos.jpg)

Upvoted @kevinwong..have a great day

thanks for sharing this wonderful platform of cyptocurrency blockmason..

neoxian is doing a great work...........////////////

while I am not into taking out loan, borrowing sbd to buy steem at the current price seems to me good idea.

Blockmason would allow us to prove that two parties agreed to a (monetary) transaction and what that transaction was.   This is much like a cohabitation agreement between a couple.

The difference is ... for a cohabitation (AKA pre-nuptual) in Canada or US, you typically have to pay a lawyer $1000 to notarize that the two individuals did knowingly enter this agreement  together.  On the blockchain, using blockmason, the agreement is drafted and if both parties agree to accept, then it is notarized by the blockchain.

If the receiving party fails to repay the debt, there's still no method of enforcing the agreement, unless they go so far as putting some form of cryptocurrency in trust as collateral.

I'm fairly certain that tokenization of credit is going to become popular and as mainstream as it can get.  Where there's funds there's credit, it's as simple as that.  

I can't say much about Blockmason without reading the whitepaper and checking out the team in detail. So far it doesn't look good, one of them is a Harvard yuppie who already scammed some money from a Cayman Islands "company". Only one is somewhat respectable.  Need to go through it thoroughly to form a proper opinion though as the reason few understand could be because it makes no logical sense.

Do you think this really needs a whole new token and protocol? I'm not seeing it.

You can basically do this in a plain text document. "Joe owes John $100 by June 23rd."

For a bank or some other institution that issues credit regularly, the blockchain might not add any new features... since the whole point of blockchain is trustless applications, eliminating middlemen, right? and in the case of a bank issuing credit, the bank already acts as the trusted third party by default. 

In the example of Neoxian's loans - a simple steem post accomplishes this task just fine. Why issue a whole ERC-20 token around it?

good post, may be useful for all users steemit, thanks for sharing.

About the only thing I appreciate about @neoxian is how open he is about the outrageous fees lol
The thought that keeps coming up for me is, isn’t the creation of debt how the world became so fuck up in first place, creating money out of nothing then charging interest on it?
And do we really want to continue to support systems based on usury?