ConsenSys, MakerDAO, and Dether joined forces to launch Bifrost. By eliminating central third parties such as banks and governments, and introducing their stablecoin, DAI, Bifrost was built to help aid groups in conflict areas that need immediate cash on the ground. Now, charities will see more of the donated money and banks will see less of it.
Bifrost was announced on May 29th at the Oslo Freedom Forum in Norway. The platform is a crypto-to-fiat payment system, that promises to transfer money in less than three days – reducing the traditional remittance payment time by more than half with transaction fees less than 1%.
Excited to unveil that @ethereum4impact from @ConsenSys, @MakerDAO, and @dether_io have teamed up to build project #Bifrost, a system that expedites and reduces the cost of delivering of cash on the ground in crisis areas using #blockchain. https://t.co/bv014mMe8U
— Joseph Lubin (@ethereumJoseph) May 29, 2018
How Project Bifrost Works
Bifrost is the first project that the ConsenSys Social Impact division has tackled. It works by using smart contracts on the Ethereum blockchain to enable peer-to-peer value transfer.
As a result, they cut out many of the middlemen (often several different banks) and create a more direct system for people to donate money to charities.
By eliminating the need for banks, Bifrost can significantly reduce fees, ensuring that those who need the money, receive it. Once a donation is made, MakerDAO and Dether will then deliver the funds to the scheduled recipients.
MakerDAO created the DAI, a stablecoin pegged to the US dollar, removing significant volatility that currently exists with other cryptocurrencies. This helps ensure that the amount of money donated to aid groups is the amount intended recipients receive.
Dether is a peer-to-peer system that only requires a mobile phone with internet access, thereby allowing aid groups to work with the local population instead of a centralized bank. This application is critical for the two billion unbanked adults across the globe.
Robby Greenfield, ConsenSys Social Impact’s global technical lead said:
“Collaborative solutions like these … are paramount to materializing solutions in the social sector. The Bifröst initiative looks to overcome both the inefficiencies in international aid and the user experience obstacles preventing the mainstream adoption of today’s decentralized applications.”
For more information on Project Bifrost, watch the video below: