Credit and loans on Ethereum without identity?


#1

I’ve been thinking a lot about how it would be possible to issue credit or loans of crypto assets without needing a solution to the “on chain identity problem” and can’t think of any non-collateral based proposals. I’m sure there is probably some clever game-theoretic models for issuing loans and attributing credit, but each of these concepts requires some kind of information about the other party to asses risk of defaults. Is there some writings on the topic of loans/credit by Vitalik or leading experts in ETH I should read up on? What is the current consensus of the community about credit/loans smart contracts?


#3

I’d dig into microcredit, which deals with a lot of the same difficulties as extending credit using ETH.


#4

Good read thanks. I actually think microcredits could be useful in the blockchain space since loans and micropayments could be easily made in a programmatic fashion. Although, it still seems difficult to pull off since it’s so easy to sybil attack. Humans are finite, wallet addresses are practically speaking infinite. For example, assume you create a smart contract that will microloan out .01 ETH with no questions asked/no collateral and requests you pay back .011 ETH by time X. If you pay it back by time X you can receive the next loan of .02 ETH. But sybil attacked with 100,000 ETH wallets to take .01 ETH each with no intention to repay back is pretty easy in the blockchain space whereas 100,000 people amassing to take advantage of microloans is a hard coordination problem and unlikely to happen in the real world.

EDIT: I guess there’s a way around this by only allowing Z amount of loans outstanding at once. So for example, only 10 loans of .01 ETH can be outstanding at a time for a period Y and if any of those 10 loans are not paid back by period Y then they are defaulted and wiped out so the contract knows what to work with. If too many people are stealing/sybil attacking the contract then it will only wipe out Z x .01 ETH per Y period rather than get cleaned out at the beginning.