Billions of US dollars worth of stable coin sit, unused, in crypto holder's wallets worldwide.DataBased Finance offers risk-averse and risk-taker tokens to Dai providers who are prepared to support Amazon Sellers.
How It Works
Amazon Sellers grant Amazon Account access to inventory verification specialists Track.one
The Seller receives compiled inventory and sales information and the theoretical price of their current stock levels.
The Seller confirms agreement with the inventory pricing metadata and offers to presell the Brand's stock to the Pool.
For the Pool to take ownership of the inventory, it needs funding. A Non Fungible Token (NFT) is minted, locking the pricing metadata in a standardized form using the parity substrate Centrifuge Chain.
The NFT is then listed on the Ethereum Block-Chain as an immutable record of that Brand's inventory.
Each Brand's current NFT is then grouped on the asset-backed protocol TinLake to form the investment pool.
Pledging and Funding
Asynchronous to the creation of the Pool, Individuals who want to capitalize Amazon Sellers and go through Anti Money Laundering and Know Your customer onboarding through Securitize.io.
Once cleared, capital providers can participate by pledging their Dai Stable Coin to the Pool's smart contract.
As the Pool grows, the pledged Dai is exhanged for our tokens by the smart contract on TinLake
There are two categories of token for each pool:
Drop - df1drp - a 'yield' or 'risk-averse' token.
Tin - df1tin - a 'risk-taker' token.
Drop and Tin pay returns based on payment streams from the Amazon Seller Sales fees.
Tin takes the risk of defaults first but also receives higher returns. DROP is initially protected against defaults by the TIN token and receives stable (but usually lower) returns.
Capital providers can't trade their Drop and Tin Tokens; the token only pays the original holder. Instead, tokens can be given up if other coin holders are available and willing to replace the initial holder's capital.
When enough capital is available to finance the Pool's inventory purchase, the NFTs are locked into the smart contract, and the Dai is transferred. The Pool is now funded and purchases the inventory from the Amazon Seller.
Generating Sales Fees
As the Pool now owns the inventory, it could require physical delivery. Instead, it offers the original Amazon Seller limited rights to sell the inventory on the Pool's behalf.
In return, the Pool receives a Sales Fee that covers the running costs and generates capital providers' returns. The smart contract manages the distribution of these returns.
The Revolving Pool
Every 30 days, the Brand's NFT is updated. The verifier Track.one checks that the inventory has either been replaced or been paid for. This rebalancing also allows the Amazon Seller to request additional funding for newly purchased inventory. If the Seller sells all their inventory or decides to cash out, this is when they exit the Pool.
If things go wrong
If sales fees are late or the Seller runs into difficulties, then the Pool can freeze that NFT and move to take physical possession of the product from Amazon FBA.
In this case, Databased Finance will direct its agents to sell the product at a discount to regain as much of the upfront purchase price as possible. After the costs of direct sales are covered, the sales income is distributed first to the Drop holders and then to Tin.
While this process may take time and is less than optimal, the initial price paid for all the brands' inventory is always lower than its listed value and the theoretical value, which is based on actual historical sales.
When Things Go Right
By putting the community's capital into buying new inventory faster and with a higher frequency Brand's can grow rapidly. New stock is financed on a rolling 12 months of historical sales as it arrives with Amazon FBA, so as the Brand sells more, its data reflects this... This releases more funding creating a positive upward spiral.