This initiative wants to turn Universal Basic Income into a global reality.
Universal Basic Income is a hypothesized way to stimulate the world economy by providing citizens with a monthly stipend to cover their basic needs. The concept, which gained traction in 2019 thanks in part to the campaign platform of former Presidential candidate, Andrew Yang, has now made its way to the crypto sphere.
Multi-asset trading platform eToro recently announced the official launch of GoodDollar — a non-profit initiative that plans to leverage decentralized finance as a means to offer a “digital basic income” to its users.
Speaking with Cointelegraph, Yoni Assia, founder and CEO of eToro and founder of GoodDollar, explained why he believes that the current economic framework is in need of renovation:
“There are two reasons for that: one, is the level of inequality that is driven by how the system works, where the rich get richer and the poor get poorer. The second is the lack of transparency around how money is issued, used, and being moved. By definition, interest-bearing money rewards those who have the most amount of money.”
Assia concluded that, while GoodDollar isn’t something “completely different,” the idea is distinct enough to make a meaningful impact on the issues inherent in current economic models. He likewise noted the familiarity of interest rates, “which [are] a proven concept that basically everyone understands,” and said that GoodDollar will be used to deploy them “with inclusion and equality as the goal,” where every person receives the benefit unrelated to how much money they have.
Anna Stone, head of Go-to-Market, discussed the project’s reasons for utilizing the traction-gaining concept of yield farming:
“G$ is a reserve-based token which means that it has real monetary value and liquidity from day one. Yield-farming, interest from staking, fees from liquidity mining, and other new yet to be created de-fi innovations are all different ways to sustainably create and source value to fortify the GoodDollar reserve.”
GoodDollar is backed by a monetary basket of crypto assets whose value is derived from the interest generated by third-party permissionless protocols.
Through the amassed reserve interest, G$ coins are minted: individual and corporate supporters receive market-rate yield-payouts in G$, and a daily amount is set aside for distribution as basic income for the platform’s participants.
At launch, DAI will be the first crypto asset supported in GoodDollar’s monetary reserve, while Compound is set to become the platform’s first integrated protocol. Tomer Bariach, head of product and token design at GoodDollar, explained:
“DAI is the market-leading decentralized stable coin and one of the most popular assets for staking; its stable nature makes it useful as an initial reserve-currency as G$ are intended to be used for barter and trade. Compound has been widely accepted by stakers and users, with over 600 million USD worth of assets staked in Compound.”
GoodDollar’s motivations were partially inspired by a recent study from the University of Oxford, which found that 71% of Europeans support UBI in the wake of the COVID-19 pandemic.