Residual Token, Inc. ($eRSDL) Launches First-Ever DeFi Pool for US Businesses
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Cheyenne, Wyoming–(Newsfile Corp. – June 2, 2022) – For U.S. businesses holding bitcoin, ethereum, or stablecoins, Residual Token, Inc. ($eRSDL) has launched the first U.S. regulatory-compliant DeFi pool. Treasurers, CFOs and controllers of American companies face the challenge associated with the limited permitted use of their digital assets. Responsible for managing these assets, most have kept them in cold storage or with guardians; rely solely on price appreciation to meet return expectations.
Institutional DeFi pool
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For years, retail crypto users have been able to experiment with ways to generate yield by providing their digital assets in DeFi pools all over the decentralized web. Some of these experiments have paid off for retail users, but the overarching problem for institutions; namely, knowing the source of the returns, remained an open question. Residual Token (ticker: $eRSDL), together with its banking partner, NextBank International, Inc., a wholly owned subsidiary of NextPlay Technologies, Inc. (NASDAQ: NXTP), and custodian, Aegis Custody, have built a platform which solves the institutional problem, source of the problem of profitability.
US companies can securely provide and borrow in a closed DeFi P2P (pool-to-peer) environment with their recently launched, regulatory-compliant, advanced technology framework. The bank’s commercial clients will participate in a private pool only with the bank’s other US institutional clients.
“The US government wants to know where and how returns are generated,” says Howard Krieger, CEO of Residual Token, Inc. “Frankly, if I’m the controller, treasurer, or CFO of a US company holding crypto, I have the same concerns.”
Residual Token calls the product ReserveLending+ and its goal is to provide a safe harbor in the open ocean of DeFI.
What is DeFi P2P (pool-to-peer)?
Unlike traditional lending pools where returns are calculated in a black box, decentralized peer-to-peer lending pools generate revenue for providers by charging borrowers interest. People and businesses participate by adding their cash (assets) to a pool that counterparties can borrow on an overcollateralized basis. Today, most P2P platforms are either permissionless or made up of a heterogeneous mix of people and businesses from around the world.
An example of the latter is Reserve Loan, Residual Token’s retail DeFi P2P lending platform. Anyone with an ERC-20 wallet address can participate. Although this type of platform meets the needs of individuals or entities not concerned with where the borrower generated the capital to pay the interest, the risk for US companies that the source of the funds to generate the return to be ill-gotten is too great.
Overview of Lending Pools
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What is institutional decentralized finance?
Institutional DeFi is a term that crypto enthusiasts may or may not have heard of before. Platforms like AAVE Arc, using Fireblocks custody and wallet controls, provide institutions around the world with FATF (Financial Action Task Force) compliant access to a pool-to-peer platform.
Similar to retail decentralized finance, institutional DeFi enables the supply and borrowing of selected cryptocurrencies. Institutional DeFI only allows KYC (Know-Your-Customer) and whitelisted entities in a pool. Specific to ReserveLending+, each entity must submit to accept compliance with strict Anti Money Laundering (AML) guidelines through their NextBank deposit account application in order to be whitelisted. Other institutional platforms have their own terms and conditions and ways to maintain the trust and security of its corporate members.
As a result, excess bitcoin, ethereum or other digital assets held by the company may earn interest in some cases at higher savings rates than those offered by traditional banks. Conversely, loans can be drawn at competitive rates for qualified borrowers.
Specific to $eRSDL holders, Residual Token has pledged to use a portion of its revenue to purchase its token on the market based on borrower volume and prevailing interest rates. The company encourages US entities interested with crypto to request a demo to learn more.
Buying a bank: a DAO with a purpose
After a year of hard work building DeFi products, Residual Token plans to support the launch of a Decentralized and Autonomous Organization or DAO that aims to support the vision of blockchain-based institutional banking products for everyone. The DAO’s immediate goal will be to buy a bank with the DAO treasury and bring in neo-banking products, including Residual Token’s own line of products. According to Residual Token, holders of $eRSDL tokens will get early access and discounts on the DAO’s bonding program.
Blockchain technology enables safe and secure transfer of assets between unrelated parties without the need for intermediaries. Institutional DeFI, or the use of company assets to provide capital to borrowers, requires certain safeguards to be in place in order to meet regulatory guidelines and, in some cases, the company’s own fiduciary obligations. Residual Token, together with its banking and custodian partners, has designed a unique framework that addresses both the regulatory concerns that US companies may have when participating in these products, but also the concerns of the treasury managers of these companies.
About Residual Token, Inc. dba unFederalReserve
In business since 2018, Residual’s team of former bankers, technologists, and compliance professionals explored ways to make crypto lending and borrowing markets safer and traditional markets more efficient. They currently have a handful of blockchain-based software in development available for licensing. Its flagship product, ReserveLending, provides permissionless access to crypto holders so they can deposit, earn, and borrow the best digital assets securely, easily, and efficiently for cash management, hedging, or speculative purposes.
Company Name / Brand Name: Residual Token, Inc
Contact Person: Howard Krieger
Title of contact person: CEO / co-founder
Company Email: [email protected]
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