This looks like yet another cryptocurrency scam. If you want to lift people out of poverty you can just donate directly to many charities that have been doing great work for decades. You don't need to go through this extra step where a bunch of crypto grifters are taking a cut.
We actually donate all the money we generate to one such a charity (GiveDirectly). If you want to donate money to GiveDirectly, that's amazing and we encourage it—donating $35/month lifts one person out of extreme poverty [1]
Glo is an additional way to contribute to GiveDirectly. Instead of (or in addition to) donating convert your USD to Glo and it will passively generate money for GiveDirectly.
Our goal is to scale up the available money for GiveDirectly to give away. We're an actual non-profit, not a scam, and no one is taking a cut. Our operations are paid from philanthropic donations; donors receive nothing; employees receive a salary.
> Instead of (or in addition to) donating convert your USD to Glo and it will passively generate money for GiveDirectly. Our goal is to scale up the available money for GiveDirectly to give away.
That GiveDirectly isn't already doing something similar indicates to me that they believe it's not an effective use of money. You, I assume, disagree. Why should I trust your judgement over theirs?
We're not endorsed by GiveDirectly, but in our informal chats they expressed excitement about our plans. I can't speak for them but I can imagine they want to focus on their core model. Building and issuing a stablecoin is quite a separate enterprise.
As for whether Glo is an effective use of money, if we'd capture 5% of the stablecoin market we'd generate the total amount of money GiveDirectly distributed in 2021 [1]
I appreciate that you address head on the notion that people can “just give money directly” and you provide a link.
What I think I’m missing is the Why? Why would I want Glo? What’s better about owning this crypto currency than just parking my $1000 in an FDIC insured bank account and donating $25?
(Honest question - not trying to troll here at all - I’m just not seeing a reason to turn money into Glo Coin)
It's a good question! I work at Glo and I'll take a stab at it.
First, if you're already someone who uses stablecoins, Glo will do the same stuff that your stablecoin of choice does, and also provide some social good on top. We think that's going to be compelling to some folks.
Otherwise, we're aiming to reach folks who might be inspired by the long-term vision and thus be willing to put up with some friction relative to "parking my $1000 in an FDIC insured bank account and donating $25." No worries if that isn't you.
The next stage for us is to make Glo increasingly viable as a currency, meaning that you can actually use it to buy and sell stuff. That's probably the phase where Glo becomes more attractive to many than a traditional savings account.
We described these stages in more detail in a recent post to the effective altruism forum [0].
Hope that clarifies, happy to discuss this at length here or via email (seth at global income coin dot com), etc.
"We don't like crypto for the sake of crypto—it's just the only viable way to create a new currency."
Really? The only viable way? It's like they've never heard of a bank. Banks accept deposits in USD. They invest those deposits in safe instruments like US treasuries. They return the deposit when requested. The deposits are insured by the FDIC. Just start a community bank and donate the proceeds to GiveDirectly. Poof, no crypto needed.
The biggest issue with stable coins at this time is that none of the primary stable coin providers will agree to follow GAAP and have trusted 3rd party audits. As a result, it is hard not to see the whole cryptocurrency ecosystem as a house of cards on an unstable foundation.
Will Glo allow 3rd party audits by an accredited firm? If so, THAT is how you'll get people to switch over.
Yes, we will allow those. In general we'll aim to be as transparent as possible, which we believe can give us a competitive advantage over other stablecoins [1]. I personally think that being a non-profit helps with being credible in that respect.
Right now, Glo the organization is still taking shape. As we formalize, we'll have things like a board of directors, and all the standard protections/checks that nonprofits have to stop them from being evil. Will that suffice to garner trust? I am not sure, but at face value, lots of nonprofits, including those that handle cash transfers, are trusted.
To reframe this question, what would suffice to elevate Glo to the same level of trustworthiness as GiveDirectly, assuming we were structured similarly?
> To reframe this question, what would suffice to elevate Glo to the same level of trustworthiness as GiveDirectly, assuming we were structured similarly?
Why another shitty stablecoin? Stable coins have been anything but recently.
Why does this have to be on blockchain?
What happens to my money when you fold?
What happens to my money if there's a backdoor in your coin?
Where's the fund manager?
When there's a run on your coin are you going to buoy it up by selling your treasury holdings?
What happens on a weekend or a holiday when a run is happening on the coin and the treasury and the markets are closed? It can't all be in TBills, some of it has to be in USD. What's the breakdown? Where is it published?
What's to say tomorrow you won't rug pull and leave the country in a yacht? Or the leader who takes after you?
Where's your true heart at? Is it for the poor? Or are you going to transition from a non-profit to a for-profit organization, once you get a good amount of money in your coffers?
And then I see this:
To end extreme poverty, Glo would need to replace 7% of all the money in the
world. While ambitious, this is not impossible:
We'd be at 100% of our goal if 87% of US savings deposits ($10.6 trillion) were converted to Glo
We'd be at 63% of our goal if all cash held by US companies ($5.8 trillion) were converted to Glo
Look you guys are clearly smart, but you've drunk the kool-aid.
Stablecoins offer a lot of utility already. Glo will be fully-backed by reserve assets to maintain stability. This is much different than stablecoins you might consider not so trustworthy.
Blockchain allows a new form of money to be created and used in a very efficient manner. There is no need to build out new financial infrastructure or payment network to use this new form of money. Blockchains have proven to be trusted forms of ledgers.
If we were to cease operations, we'd ensure that every Glo stablecoin outstanding is still redeemable for $1.
We are taking extreme care in our development to prevent any potential vulnerabilities in the stablecoin itself and the processes we incorporate as an organization.
We have expertise around managing funds and are also looking to add talent in that domain.
Treasuries will be liquidated to make sure redemption demand is met. We have no profit incentive to take any liquidity risk with reserve assets. The breakdown between USD and treasuries will be real-time transparent. At smaller market caps, we'll have to lean towards greater liquidity. At larger market cap, we'll conservatively estimate a trustworthy composition of assets.
Global Income Coin will exist solely for the benefit the mission.
I recently joined Glo as Head of Partnerships. Happy to answer any questions about why I personally chose working with them over starting another company/working for FAANG.
- I've been a long time supporter of basic income projects. Seeing an actionable way to contribute to that is huge, and I see Glo as a force multiplier for the great work being done at GiveDirectly.
- There are major issues with many of the extant stablecoins. Stablecoin holders should be able to frictionlessly burn and mint new coins, as well as have an accurate audit of all backing assets. Glo will provide all of this.
- The team truly believes in the core mission of defeating extreme poverty in a way that frankly outpaced other non-profits I talked to. I am confident all of my coworkers are 100% in.
There's a lot more but that's a high level answer of the major reasons.
That's a lie, you are losing out on the interest rate on the money held in escrow.