I came across PoolTogether recently, and think that our mission to end extreme poverty resonates with PoolTogether’s mission being financial freedom for all.
Glo Dollar is a US regulated, fiat-backed stablecoin, with no profit incentive. We donate 100% of the earnings backing the Glo Dollar toward basic income programs for people living in extreme poverty.
700 million people are trapped in poverty (and live on less than $2.15 per day). The poverty trap is quite literally the opposite of financial freedom.
I propose that PoolTogether exchanges a portion of their stable holdings for Glo Dollars. By doing so, they’d embed philanthropy into its very operations. Not only would PoolTogether help those privileged enough to achieve financial freedom, they’d also help people to escape the poverty trap.
Eventually, every $20K held in Glo Dollars will lift one person out of extreme poverty. This comes at no additional cost to PoolTogether.
Doing so has 3 benefits:
PoolTogether would embed philanthropy into its funds, and use it as a force for good by generating basic incomes for people living in extreme poverty.
By adding Glo Dollars alongside current stable holdings, PoolTogether would further diversify its treasury.
Supporting the development of an alternative US regulated stablecoin that benefits the public and the broader crypto ecosystem, instead of a few shareholders.
Thanks for reaching out and sharing Glo’s impactful mission. The PT community is always open to exploring collaborations that align with the goal of promoting financial well-being.
Your proposal to incorporate Glo Dollars into the PT ecosystem is intriguing, especially given the philanthropic angle. To understand the fit and feasibility better, I have a couple questions:
Could you provide more details on the regulatory framework surrounding Glo Dollars?
Can you share any existing partnerships or integrations within DeFi or traditional sectors where Glo Dollars are currently used?
Looking forward to a deeper conversation on this and potentially setting up a meeting to discuss further. And like Tjark, I would also love to see a Glo prize vault on V5 some day!
Hi Tjark, great to hear you’re personally intrigued!
Liquidity. Glo Dollar is available on Uniswap v3, so slippage should be low for retail users—but the pools are still limited. If PoolTogether were to agree to make the swap, we could add additional liquidity to facilitate the swap. Alternatively, depending on PoolTogether’s entity status (incorporated, unincorporated DAO, and jurisdiction) it may be able to mint/burn directly with our issuer, Brale or one of the many OTC desks that support USDGLO. Trades through our issuer or preferred OTC desks would be facilitated 1-1 with no fees. We have facilitated multiple $100k+ mints on Ethereum and Polygon through these channels.
Yield generation. Our yield generation mechanism is similar to Circle’s USDC. The reserves backing the Glo Dollar are invested into US Government backed debt, such as Treasuries. With one differentiator: that wechannel our earnings from the reserve to people living on less than $2.15 per day (see next point).
Yield captured for UBI. 100% of the yield that the Glo Foundation receives goes toward basic income programs. The best way to explain this is that when holding USDC/T, the yield generated goes exclusively to shareholders of Circle and Tether. In our case, that yield goes toward ending extreme poverty. The reserve’s earnings are shared between Glo Foundation and our issuance partner Brale to help them cover the costs of being the regulated issuer and administrating the reserves. At market caps beyond $2M we receive a growing share of the earnings. At scale, we project that every $20,000 of Glo Dollar adoption will lift one person out of extreme poverty. This is true when 80% of Glo Dollar’s backing assets are invested, an annual yield of 4% is made on these investments, and 75% of the yield goes to us, the Glo Foundation. Under these metrics, we’d earn and donate $480 to GiveDirectly. Enough to lift one person out of extreme poverty.
Backing of the Glo Dollar. Our issuance partner, Brale, publishes management’s assertion of the reserves here. You can see that the reserves are held as US dollar deposits, short term US treasuries and similar cash equivalents across US financial institutions. Brale is currently working through attestations with a third party CPA firm and expects to have the first third party attestation published in December for November.
We’d love to explore the possibility of of USDGLO price vault. Is that something we should discuss separately?
Glo Dollar was developed by the Glo Foundation and is issued by Brale.xyz in the United States. Brale operates under the same licensing framework that Circle does to issue USDC in the United States. Brale is a FinCEN registered Money Services Business and has obtained Money Transmitter Licenses (MTLs) or exemptions to conduct business in 35 states and counting. Their NMLS ID is #2376957 and you can verify them as a financial services provider in the NMLS database. The MTLs require Brale to have recurring audits from third party firms which are reviewed by state regulators. This includes the reserve backing of issued stablecoins. It also includes Brale’s own financial condition, compliance audit, penetration testing, SOC2 audit, and smart contract audit.
Building on this is the Glo Consortium, where 20+ organizations have joined to embed philanthropy into their organizations through holding Glo, accepting Glo as a payment option, donating to Glo Foundation, or integrating with Glo in another way. You can learn more about this on our website (unfortunately I cannot link the relevant page, as I’m limited to 2 links atm )
Would love to jump on a call with you to discuss further (both funds diversification & Glo prize vault).
I’d love to know a little more about the considerations that led GLO to have its backing offchain in the first place.
From this thread I gather:
80% of assets are invested.
Only 75% of yield goes to the foundation (after $2M).
This is only 60% capital efficiency all things considered. You’d be able to use much lower onchain yield rates and still have the same return towards UBI, with less intermediaries.
We deliberately chose to hold our backing offchain because we believe it’s the model that allows for capturing the largest market share. Centralized stablecoins have a market cap an order of magnitude larger than decentralized ones, which allows for more opportunities to compete. Furthermore, centralized stablecoins are easier to get started with for crypto-ignorant people than decentralized ones - this is important because the Glo Dollar narrative is received well by non-crypto people, which we want to leverage to increase the total size of the crypto-pie.
You’re right that we’re faced with lower capital efficiency, but the market cap potential should ultimately lead to more dollars going to good causes.
Just wanna say here, I like the general idea of Glo Dollar and I’m a big fan of GiveDirectly.
If Glo Dollar supports ERC4626 in some way, I wouldn’t be totally opposed of using some treasury funds and deposit them into a Glo Dollar Prize Vault on ETH after we launch on ETH. It would be good if Glo Dollar would also deposit some funds into that prize vault and then we promote that anyone could hold their Glo Dollar in a PT prize Vault and earn POOL prizes that way.
Glad to hear you like the idea of Glo Dollar and are a big fan of GiveDirectly @Lonser !
We do not support ERC4626 atm, but we’d be happy to explore how we can integrate in the PoolTogether ecosystem as well as co-create a Glo Dollar Prize Vault which Glo Dollar also deposits some funds into and we then promote together.
Would be awesome if we could get some guidance in that process however - any volunteers ?
Is that something we should discuss separately?
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