W3P: Minimal intermediary credit card
October 5th, 2022

There are a growing number of credit cards for a crypto account from Gemini, Coinbase, and others. But none use DeFi in a meaningful way and all still have a company (not protocol) in the middle. Similarly, DeFi lending is mostly still leveraged trading vs. use cases like a consumer credit account. What would a solution look like here?

Deposit $20k of ETH into “the Protocol”, a 4626 wrapper around Aave. Protocol issues you a credit card that can be used for merchant payments, which borrows USDC from Aave and sends to merchant’s bank/custodian. Bonus points for bypassing Visa/Mastercard networks eventually.

Protocol strongly incentivizes you to pay off your card every month, otherwise your Aave collateral is at risk. Protocol earns a % of your Aave yield, plus default fees. Protocol has baked in liquidation protection for ETH price risk a la DeFi Saver and super strong fraud & risk management. Perhaps you don’t even get chargeback protection.

Web3 Pitches (W3P) are short product write-ups that describe an emerging problem or opportunity in the Web3 space and proposes a minimal-viable solution that could be tested and iterated with users. The pitches are presented in screenshot essay form, which is meant to be short enough to be consumed on one page of a mobile screen. :-)

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