Problem Description
In developing countries, such as those in Latin America and Africa, fiat currencies are weak and represent a loss of the population's purchasing power, as the monetary policy of Local Governments is not able to curb inflation.
For local merchants, it is not practical to accept ADA as a means of payment for their products and services, as to avoid high volatility they prefer to keep their sales revenues in a stable currency, such as the dollar, or, to operate the business, they need to keep cash in fiat currency.
On the other hand, there is an effervescent pro-crypto movement in countries like Venezuela, Argentina and Brazil, which is perceived in other continents, such as Africa, where people use cryptocurrencies as a store of value (capital protection), but even if they want to and requiring merchants find it difficult to use crypto as a means of payment due to the lack of this option in local retail.
Merchants do not have the time and resources to spend on receiving payment in crypto (b2c) and converting to a stable currency such as the dollar or even a fiat currency, which is commonly a necessity as they depend on a chain of business, such as suppliers and creditors who only use fiat money (b2b).
Solution Description
Development of a dApp for merchants to receive payment in ADA, allowing automatic conversion to stablecoin or fiat currency.
The dApp must allow the merchant to register their products for sale by informing the price in fiat currency/stablecoin, their wallet address and their option to receive (ada, stablecoin or fiat currency); then generate a QRCode for the buyer to scan; the dApp will then display the product price in ADA and the merchant's warehouse address on the smart contract.
At this point, the smart contract will manage the merchant's receiving option:
A) If the merchant chooses to receive payment in ADA, they will be transferred to their wallet;
B) However, if they chooses to receive in stablecoin, the dApp should seek the best price in decentralized exchanges and carry out the exchange, similar to what is done by the well-known dAPP 1inch;
C) If the merchant decides to receive in fiat currency, the dApp will seek the best price on a p2p liquidity provision exchange, connecting the merchant with the p2p trader.
This p2p liquidity provision exchange is an integral part of this solution, and comprises allowing people to register their desire to exchange fiat currency for ADA, stablecoin or any other token tradable on the decentralized exchanges of the Cardano network connected to the dApp.
The transaction will take place between the shopkeeper and the p2p trader, while the smart contract will securely mediate the exchange in the following mechanics:
The liquidity provider sends the fiat currency to the merchant's bank account, which will have a predetermined time to signal whether it has received the payment, if the merchant confirms within the time or time limit is reached, the ADA or token desired by the provider of p2p liquidity is released to your portfolio. However, if the trader informs within the time that he has not received the fiat currency, a dispute opens which will be mediated by 3 mediating agents randomly chosen to verify the supporting documents of the p2p liquidity provider, and then decide whether or not to release the tokens.
In case of need for mediation, the mediators, which can be any person, will receive a spread for the mediation service.
In all three cases, a small spread rate will be deducted for the operationalization of the solution, as well as for the payment of the mediators of the negotiations of the p2p liquidity provision exchange.
ATTENTION
This proposal is being fragmented in this and subsequent funds, as the complete proposal was not funded, even though it was approved in Fund 7.
This proposal ONLY involves the p2p liquidity exchange.
Mission
Adoption is the key to blockchain success. This proposal aims to solve a problem in this area, bringing efficiency to merchants through a blockchain dapp, which will enable the use of Cardano as a means of payment.
Long term plan
* Audit;
* Continuous development of the solution, implementing improvements and innovations;
* Creation of DAO through governance token;
* Integration with Atala Prisma;
* Marketing actions focused on expanding the audience and massive adoption of dApp;
* And more…
Risk
* Scalability issues at Cardano and delayed launch of Ouroboros Hydra;
* Regulatory risks that make adoption unfeasible.