>>>
Our solution, WadaDex, is a Two-Tier Liquidity Maximizing Exchange for Simplifying Participation and Facilitating Project Capital Access via a Frictionless Micro-Capital Market. WadaDex is designed to achieve two objectives:
- To simplify participation in the crypto-currency ecosystem
- Facilitate access to capital for projects that otherwise would remain unfunded due to the triumvirate of inflation, high interest rates, and foreign exchange volatility induced risk.
The main process flow of the WadaDex platform is described here:
https://docs.google.com/presentation/d/1DjNwRY3RpKPLxqBosb0CJzG3HN__kiEvgQMRl9TOZEc/edit?usp=sharing
Please view the attached WadaDex White Paper version 1
>>>
I am the proposal writer and I have extensive experience doing business in Africa - specifically Ghana West Africa. This proposal is being submitted from an airport as I am in transit from Ghana for a research and discovery trip for WadaDex. The proposal is informed based on local real interactions and years of exposure to the political, social, and economic realities of the market. This is not a solution that is being parachuted in - it is designed with consideration from the ground up.
WadaDex High-Level Process Flow:
WadaDex as a platform is expressly designed to do the following in order of process flow:
- allow the average person in an emerging economy the opportunity to use their most economically liquid and crucial tool, the mobile phone, to simply and easily be on-boarded to the world of crypto currency; this on-ramping is a critical step towards simplifying participation and accelerating adoption
- once onboarded via fiat or mobile money, the user will have the ability to maintain their funds, transfer funds to 3rd parties, or transfer funds to our separate approach of establishing stability between our prospective WDX token and the more stable reserve international currencies
- the focus of the underlying platform is capital accrual and token value reasonable growth or stability - the reason why this is crucial is that for many participants from emerging markets the core issue is inflationary destruction of capital. Through tokens and cryptocurrency, we can mitigate against this in a frictionless manner
- once capital is parked in the platform, essentially providing a liquidity base, the next step has a two fold benefit of enabling individuals to participate in projects that may provide them a return in a frictionless manner; and by corollary to enable projects to list on the WadaDex in the quest of raising capital at a more manageable risk free rate
The financial underpinnings of the WadaDex will be built on traditional financial and risk management tooling in order to be able to easily and readily explain to third parties and regulators alike, the valuations, liquidity profiles, and risk metrics of the platform and the projects listed within.
The approach WadaDex will employ is to simplify participation in and accelerate adoption of cryptocurrency and decentralized ledger technologies; and facilitate capital access within a continent populated by developing and emerging economies with a wide range of currencies, risk profiles, interest rates, and primary GDP drivers. This is novel.
The mechanism Wada proposes is one Wada is uniquely positioned to build, deploy, and operate. The core of the Wada offering is the development and administration of a two-tier decentralized highly liquid platform that provides readily accessible fiat to cryptocurrency interchange and serves as both an on-ramp and parking place for capital within the platform. Accrued capital can then be deployed in a low friction, low transaction cost decentralized micro-capital market: WadaDex.
The WadaDex team is in the lucky position to have been able to put the principles of WadaDex into action with contracted Project Finance capital raising engagements taking place in African emerging economies. This brought even more clarity to the platform objectives, functionalities, and goals.
Alignment with Challenge KPI
This project perfectly aligns with the Challenge KPIs - in particular the core principle of the challenge that "for poor nations with no basic foundations, Nation Building Dapp solutions will be the building blocks enabling sustainable prosperity". This proposal goes to the heart of:
- halting the erosion of wealth;
- enabling savings and passive accrual of wealth;
- enabling participation in wealth creating ventures; and
- reducing the cost of capital of projects through a mechanism that enables them to raise capital via the broader community, the Cardano community, and through the use of blockchain technology
In terms of the functional challenge KPI, alignment remains synchronized:
- Diversity of Dapp's use cases: as WadaDex is a platform, that is unique on the African continent, it is open to businesses and projects alike for the raising of capital and enables project owners and their community to define their own unique repayment, participation, or reward terms
- Proposers commercial approach and negotiation strategy with different Governments: we have an integrated approach that includes discussions with government officials - in many instances at the highest level. We are mindful of the regulatory concerns but are insistent that WadaDex not be financed with traditional financing sources originating from within the targeted emerging economies.
- Participation of Cardano's Local Community Centers (Wada hubs): this project is closely tied to Wada, which is one of the most sought after Catalyst proposal partners and has a trusted reputation within the Catalyst community. WadaDex key executives are amongst the most active Wada participants.
- Participation and/or partnerships with other international organizations: WadaDex already has associations in a private advisory capacity with prominent Development Finance Institutions in the US and Africa.
- Number of countries covered, contracts signed: as this proposal is being written, SCI, a main WadaDex partner has no fewer than three pending Project Finance Agreements that are serving as actual use cases for the platform and its technological and strategic underpinnings.
- Dapps impact on social/financial inclusion: the impact on financial inclusion will be catalysmic within the region if successful. At minimum the visibility WadaDex will provide to projects and the capacity for WadaDex to serve as a Catalyst Secondary market will boost the likelihood of success of many projects. This does not take into account the multiplier effect from having a platform that assists to quickly and inexpensively capitalize projects - capitalized projects create employment and opportunity
- Dapps impact on economic development: the impact on economic development will be significant - the function of WadaDex is to effectively reduce the cost of capital and allow projects to define the nature of their project's return in a flexible manner that is enforced not by leans and bank guarantees, but by the power of smart contract, Oracles, and community due diligence.
Project Outcome Communication Strategy:
- African Development Bank and other Development Finance Institutions will be key in communicating the existence and utility of the project
- Wada's comprehensive network of partners and projects within Africa
- Local street preaching pastors in markets like Ghana
- The newly developed BlockchaininBusiness.io Cross-Chain Connector Search Engine which is submitted as a Cross-Chain Collaboration challenge project here: https://cardano.ideascale.com/c/idea/401951/
- The Catalyst Community will be key because one of the main reasons WadaDex was created was to create a secondary market for Catalyst projects that have received one funding round of capital but cannot rely on a capricious competition process for future funding rounds
>>>
The main challenges and risks are as follows:
- Regulatory Risk: we are relying on an approach that minimizes the risk of regulatory exposure, however as with all things blockchain and cryptocurrency, this is a fast moving space
- Slow Adoption: this is a paradigm shift twice over. WadaDex is making it easy for people to be onboarded to crypto and then in a further step, it is providing a new paradigm of raising money. In my practical experience in promoting this approach a significant educational component is required and project owners spend considerable time in trying to understand the limitations, scope and drawback
- Inadequate Project Capitalization: whilst the WadaDex as a platform itself can be built efficiently, the projects that list on the platform must have access to capital in order for the platform to be successful. This is a different type of liquidity risk that will need to be closely monitored
- Feature Phone Integration: smart phone wallets and management of crypto is relatively straightforward. Whilst we have had discussions with Joget and are confident of success, the feature phone operations of our platform are both important and represent a risk of failure - should the feature phone operations not work, the platform would still be robust and fully functional