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Below is an update from Fellow of the Ethereum Foundation Marcus AM.
Hi 👋, my name is Marcos and I am a researcher and builder from Guatemala, and EF Fellow. I am an optimist at heart, and I am driven by leveraging social, cultural and technological innovation to build better societies – a conviction I have held since I was young.
Guatemala: a country of difficult opportunities
As a child, I would spend weekends with my parents visiting many of the most isolated towns in Guatemala. At the time, he ran a non-profit organization whose mission was to provide terminal health care and create educational programs. The community we visited most often was Puntarenas.
To get to Puntarenas, we used to travel up to three hours by boat through dense mangrove forests to reach a village deep in the jungle. When we first began visiting, the community in Puntarenas had limited access to clean water, no healthcare or educational infrastructure, and little economic activity.
Founded during the Civil War, the people of Puntarenas sought refuge from the violence and massacres that claimed the lives of more than 200,000 innocent civilians across the country. For now, I’ll spare you the harsh reality of American involvement in Latin America (and beyond) during the Cold War, but if you’re interested in learning more about this topic, I highly recommend Schlesinger and Kinzer’s book Bitter fruit.
Over the years, we have worked with the Puntarenas community to deliver medical and dental drives, establish a healthcare clinic, build housing, and raise funds for infrastructure investments, including a community-run school.
Two decades later, Puntarenas is now a self-sufficient village, where families have access to education, healthcare, water and energy (provided by solar panels that even power a few of the school’s computers)! What is happening in Puntarenas is a reminder that access to dignified basic services can make a significant impact in a community, even in the darkest situations.
Puntarenas’ story depicts the reality of Guatemala – a beautiful country, full of culture, rich heritage, and stunning landscapes. On first impressions, Guatemala also appears to be a relatively wealthy country; In fact, we have Highest GDP in Central America And at some point, The largest number of helicopters Per capita worldwide.
Unfortunately, Guatemala’s social and economic fabric paints a very different picture. We are a country facing extreme inequality, started by a violent 36-year civil war and a history of exploitation and corruption. Throughout rural and indigenous areas of Guatemala, it is not uncommon to encounter communities that, like Puntarena once were, cut off from basic services such as running water, energy, shelter, health care, education, and food. Despite these difficult conditions, people in these areas strive to create better livelihoods for themselves and those around them.
The effect starts at home
One of the biggest challenges facing development is the fact that More than 19.6 million people in Guatemala live in desolate living conditions. In extreme cases, multiple generations have to share a room, where open fires pollute the air, and where sanitation becomes an afterthought (if it exists at all).
We believe that providing decent housing is the basis for building a better future for everyone. After all, our homes are where we spend most of our time, where we learn, where our families come together, and where dreams are born.
That’s why I and a group of lifelong friends are working on an initiative called Lamina pop. Lamina POP is a patented construction technology that uses common building materials in innovative ways to build cheap, lightweight, and architecturally sound homes. This technology is simple and can be deployed even in remote areas of Guatemala.
Working with our partners, including Habitat for Humanity, the University of Cambridge, and Stanford, the Lamina POP system dramatically improves the well-being of those for whom we build homes. Collectively, we believe that home is more than just four walls – it is an opportunity to offer a renewed sense of optimism and growth.
The results of decent housing are clear. From enhancing educational outcomes, reducing the environmental impact of housing, to improving mental health, we have seen the incredible engine of development that the Lamina POP system can provide. As we continue to develop, we are excited about the prospect of offering more innovation-driven solutions throughout Guatemala and beyond.
Despite our efforts, we have found that one of the major barriers to mass adoption of innovative solutions like the Lamina POP solution is the lack of financial infrastructure and education in underserved communities. Even though the Lamina POP solution is 30% cheaper than any other leading low-cost housing alternative, the people we aim to build housing for are unable to access loans at low interest rates to invest in a home for their family.
Many of the financial transactions that take place in these communities occur in the “informal” economy. Payment is made in cash, debts are not recorded, and goods and services are outside the scope of financial institutions. Sending payments, obtaining loans at low interest rates, building a credit history, and tracking trade are nearly impossible under Guatemala’s current financial infrastructure. Working in the “informal” economy keeps the door closed for ordinary people to take advantage of personal loans and business investments, let alone mortgages.
As a result, many of these individuals rely on predatory lenders (including traditional financial institutions), who often exploit vulnerable populations for their own gain. It is not uncommon to find it throughout Latin America Lender sharks who will lend at a monthly interest rate of 20%. crippling debts It leaves many in precarious situations Forcing them to lose their property titles, fall into delinquency, or worse, commit suicide.
Can cryptocurrencies help?
Among many things, crypto promises to create new, more equitable economic models that can benefit everyone, not just the rich and powerful. Some see the promise of DeFi as the ability to bring financial services to those who may not have access to traditional financial instruments in emerging economies around the world, including some of the world’s most disadvantaged communities.
If you’re reading this, you’re probably optimistic about technology’s ability to address some of these issues. Maybe this means decentralized networks so Essentially a revolution The way we interact with ourselves, with each other, and with systems of power. Or perhaps it simply means apps that use new, more accurate types of digital information to evaluate someone’s creditworthiness so they can get a favorable interest rate on a small loan. I think the reality will be somewhere in between.
In its current form, it is an understatement to say that decentralized finance is ready to provide viable new paths to financial inclusion at scale. We face enormous barriers to digital and financial literacy, institutional trust, and significant challenges on the user experience front. But despite where the industry is currently, I believe we have everything in hand to build solutions tailored to communities like Puntarenas.
Next Billion Fellowship
I’ve spent the last few months actively exploring ways to break this financial empowerment barrier by leveraging the power of Ethereum. My goal is to research a number of viable solutions powered by crypto technologies for financial inclusion and access to credit to ultimately enable human prosperity across Guatemala and beyond.
I’ve been looking for coins that might be useful in a place like Puntarenas and in the rest of Guatemala. In particular, I have been exploring the barriers to adoption of these policies and potential solutions that can be used to unleash peer-to-peer lending to benefit those who do not have access to more equitable financial mechanisms.
So far, as part of my research, I’ve spoken with members of hundreds of cryptocurrency projects including leading DeFi protocols, DAOs, identity and scale solutions, and other core developers, designers, and wallet builders. Additionally, I conducted conversations and interviews with leading local projects, government offices, and international NGOs across Guatemala and other emerging economies to understand where they see cryptocurrencies serving as a catalyst for new means of coordination and fair financial services.
This research has been incredibly insightful and has allowed me to gain a better understanding of the current state of DeFi and the potential of the broader cryptocurrency ecosystem in emerging economies.
Next steps
I am currently preparing an open source report that will provide a detailed understanding of the current cryptocurrency landscape and provide recommendations on how cryptocurrencies can best be used to unlock greater financial inclusion, especially for those in emerging economies. I’ll be posting the final report by the first week of March (just in time for ETHDenver), so stay tuned!
In addition to the written report, I will publish an audio-visual series featuring a variety of stakeholders. This includes thought leaders and original builders of cryptocurrencies, those deploying solutions in emerging economies that benefit from cryptocurrencies, and of course the last-mile communities and organizations that will ultimately benefit from this technology.
The report and video series I’m creating are primarily aimed at cryptocurrency creators who want to better understand the landscape of technical, educational, and social challenges and opportunities to consider; As well as impact-led organizations across emerging countries seeking to understand how cryptocurrencies can specifically benefit their efforts and initiatives.
You can stay up to date with the latest research results via email and contribute to the report Subscribe and mint Free NFT on Mirror. Let’s communicate too Twitter!
