DeFi is best-suited to the underserved population with limited access to the banking system but do have access to a smartphone. Celo is a decentralised social payments system designed for mobile phones that aims to remove these two biggest barriers to the mass adoption of crypto as a payment option - ease of use and purchasing-power volatility. Let’s learn how.
Celo aims to bring together the power of mobile phones and crypto to harness the power of Defi via the creation of dApps and smart contracts. It is a fully EVM- compatible Proof-of-Stake Layer-1 protocol that is focused on increasing the adoption of crypto via address-based encryption scheme and stable value assets to tackle the barriers mentioned above.
For any cryptographic social payments system to grow and attain large-scale adoption, sending a payment should be as easy as sending a text message. Celo protocol introduces ‘address-based encryption’ - a cryptographic scheme where participants can verify their mobile phone numbers to their public key mappings. This would allow users to use their mobile phone numbers as public keys, similar to UPI-linked apps.
To tackle the stability issue, Celo uses an asset whose value is stabilized via a monetary policy with elastic supply rules while being backed by a variable value reserve.
The platform uses a governance structure in which the protocol creates a host of local, regional, and utility stable-value currencies. The introduction of these stable-value coins to the family of protocol coins helps to strengthen the stability of existing coins.
Celo uses a mobile block reward mechanism in which all the users involved in the transactions can participate in verifications. This mechanism helps in creating a broad participant base and making the block rewards accessible for day-to-day users.
CELO is the proof-of-stake native token of the Celo protocol. Users can pay transaction fees, participate in governance, and related activities using the CELO token. CELO token has a total supply of 1 billion and a circulating supply of over 427 million.
CELO token is priced at $2.78 today and is amongst the top 75 cryptocurrencies by market cap. The coin has been in a clear downtrend for several weeks now, and is now looking to establish a clear reversal and reclaim supports. The first one at $2.6 has been held so far, while the immediate targets to reclaim now are $2.95 and $3.22. Those looking to play conservative may want a reclamation of $3.5-3.6 before going long.
Source: TradingView, Binance
Celo aims to bring one billion users under its network by 2025. The Celo community has also undertaken wonderful environment-friendly initiatives, such as tokenizing the rainforests and building a more sustainable and carbon-negative blockchain of the future. As Defi grows and becomes more mainstream, Celo’s relevance as a decentralized social payments platform will rise.
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Disclaimer: This article was authored by Giottus Crypto Exchange as a part of a paid partnership with The News Minute. Crypto-asset or cryptocurrency investments are subject to market risks such as volatility and have no guaranteed returns. Please do your own research before investing and seek independent legal/financial advice if you are unsure about the investments.