Last updated: 11 August 2022 08:20 AM
Finance in the crypto ecosystem is facing a huge trust issue. Smart contracts are often proxies, with the actual logic of the contract hidden away in a separate logic contract. Many projects include a multi-signature "wallet" with unnecessarily-powerful permissions. And it is not possible to independently verify that stablecoins have enough real-world assets to continue maintaining their peg, creating a large loss of funds (such as happened in the official bankruptcy announcement of Celsius and UST de-pegging and anchor protocol failure). One should not trust exchanges or other third parties with one's own investments.
The pattern empowers more self-sovereignty and gives more credentials(obviously with an Account-bound token) than locking financial data in the operating team's contract.
Segregation between investor's fund and operation fee is clearly specified in the smart contract, so investors can ensure safety from arbitrary loss of funds by the operating team's control.
We ran into problems on how to define contribution for having an soul-bound token with credentials. We solved it with weight ed decision matrix on credentials from soul-bound tokens.
Here is the detail of the governance structure.