With Benefits for All, GSN Redefines the Social Networking Economy

Blockchain has been the new technology trend around the world in recent years and the most influential countries are proactively developing integrations of blockchain with traditional industries. In October 2019, China brought blockchain to the forefront on a national strategic level. In April of 2020, The National Development and Reform Commission of PRC included “Blockchain” as a new infrastructure for the first time, stating explicitly that it is part of the country’s information infrastructure.

Blockchain transforms the way information is transferred and stored in a decentralized manner and it is, in essence, the reorganization of credit structure. For the finance industry where credit is a building block, blockchain is a natural extension to revolutionize finance. It will pave the way for a brand new financial world of inclusivity and mutual benefits.

The Supply-Demand Imbalance of Capital

The demand for capital dates back hundreds of years to the Tang Dynasty of China when peer-to-peer lending institutions offered microcredit services which scaled to the entire Eastern Asian market. Although megabanks and financial organizations prevail in the modern financial system, such peer-to-peer banking services are still popular around the world.

This is mainly due to the imbalance between supply and demand.

On one hand, when supply is concerned, the competitive advantages of megabanks attracting more customers and having a well-built reputation help secure clients’ capital and yield low-but-stable returns. Nonetheless, these virtues do not mean a lot when serving an individual’s needs, as the growth of wealth is highly correlated with capital flows. A legitimate capital flow would surely generate more interest for a customer than keeping his money in a bank account, hence it’s people’s realistic demand to seek a safer way to earn money with money.

Regarding demand, on the other hand, it’s common for individuals and small companies or micro-entities to have demand for capital. However, not all the needs of individuals can be satisfied, considering today’s antiquated and rigid banking systems. According to A Survey of Bankers in Q4 2020 publicized by People’s Bank of China, the loan demand index of small companies and micro-entities in the country has been over 60% since 2017. In 2020, particularly in the first half, the demand was reaching 80% while the fourth quarter also had a reading of 74.7%, however, the loan approval index in Q4 was merely 53.6%. The capital demand gap is considerable for those enterprises.

The asymmetry between supply and demand is a significant pain point currently plaguing the traditional financial system. But the problem is the lack of a scientific distribution system that fulfills the banking tasks while maintaining complete trust from users. Most people’s trust is based on their interpersonal relationships, where one places trust in his family or friends for instance.

Blockchain demonstrates its potential for addressing trust issues on a financial level.

GSN, Built for Our Time

GSN is a decentralized social banking service system, the first of its kind in the world, restructuring a trust model powered by blockchain and matching supply to demand with the help of smart contract technology. The process is made more transparent, secure, and reliable thanks to blockchain.

In GSN’s design, everyone has the right to use capital, provide peer-to-peer liquidity or get adequate liquidity support from the platform to maximize their capital efficiency and increase their net worth.

With the traditional banking system, money deposits represent customer authorization for the bank to conduct financial transactions like lending and investing. With GSN, a user puts money in his wallet and once he decides to provide liquidity, the platform will match his capital with those in need through the deployment of smart contracts. Capital flows directly between two wallets and user privacy is greatly protected through anonymity of the blockchain. Along with gains from interest, a user also gets a bonus from the platform as an incentive for participating in the GSN economy.

GSN advocates the idea of a social networking economy that brings about inclusiveness and mutual benefits. This platform connects every class, community, and group from all around the world for a chance to allocate capital based on various needs and a desire to create wealth. In a more open and inclusive financial environment that supports reciprocal relationships and cooperation for mutual benefits, not only will people be better off, the society as a whole also enjoys more robust economic growth.

From a technical perspective, GSN is powered by blockchain which enables the deployment of Distributed Credit Data Management Framework (DCDMF), an open-source management framework for individual credit data that is supported by cloud storage service providers. With DCDMF, users can establish personal credit data and quickly export it through GSN to prove their eligibility for different social events.

GSN empowers everyone, based on his credit report issued by the platform and transaction data observed by the block explorer, to determine their participation in a decentralized market. Such design makes it possible for benefits to be given back to the user himself rather than intermediaries. With the help of GSN’s AI algorithms, supply is allocated according to data and each participant will benefit.

Thanks to its safe and efficient circulating system, GSN presents five advantages over traditional banks:

• Decentralization: Smart contract system, capital not held in custody;

• No Region Restriction: Sheer expansiveness, not restricted by borders;

• Double-Entry Bookkeeping: Records immutable and accessible all the time;

• Yield: 5% block reward;

• Security: The asset is returned when the success rate is below 90%.

Visions of GSN

Building a decentralized platform for social banking services is merely the start of GSN’s journey to optimize the traditional financial system. The team has its eyes on even greater heights. While the platform attracts more users, GSN will launch the second phase: establishing international trade to finance global businesses and supply chains. With the plan smoothly carried out in the future, GSN shall initiate crowdfunding for the building of international infrastructure. The goal of which will be to contribute to the overall success of global trade!

History suggests that the market always rewards investors who are eager to explore new things and have faith in development. As an innovator in the field of FinTech services, GSN is confident in its development and believes now is the best chance to learn, research and participate in this disruptive innovation.

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Website: https://gsn.io/