Celo Foundation’s Alliance for Prosperity seeks financial inclusion

The Celo Foundation’s Alliance for Prosperity believes blockchain technology can bring financial inclusion and a shot at prosperity to the world’s poorest.

Announced on March 11, the 51-member Alliance aims to support the Celo blockchain by building a variety of mobile phone-based financial tools aimed broadly at combating poverty and inequality.  

This goal—serving the world’s 1.7 billion people too poor to access banks and credit— is one Facebook’s Libra project claims to share. Indeed, the two stablecoin projects have several noteworthy backers in common, including Andreessen Horowitz, Anchorage, Bison Trails, and Mercy Corps. And, Coinbase Ventures is in the Alliance while Coinbase itself is a Libra member.

The Alliance for prosperity’s goal is to “use blockchain technology to reimagine the future of money and create inclusive financial tools,” said Celo’s founder, Rene Reinsberg. “From sending money home across borders to donating to a humanitarian organization, we want to make sure that money arrives in the right hands, not in the pockets of a middleman.”

That means Celo has a broader but less focused set of targets than Libra. While they share two basic ones—making the remittance payments sent home to poor countries by migrant workers faster and cheaper, and making mobile payments anywhere easier and less costly—the Alliance for Prosperity is also looking for tools to deliver humanitarian aid, make microloans and support peer-to-peer loans, and provide decentralized IDs. It also seeks to facilitate mobile and online work.

“As we begin to witness a revolution in global financial systems, we are committed to ensuring that the voices of the world’s most vulnerable people are heard and that new digital financial services include them and their needs,” said Alpen Sheth, Mercy Corps’ senior technologist for blockchain. With “a long history of facilitating financial inclusion around the world we have seen how difficult it is to escape poverty when you’re excluded from financial system. We believe in Celo’s mission to build a financial system that creates conditions of prosperity—for everyone.”

Making blockchain simple

To do all that, Alliance members will build mobile-friendly dApps that run on top of Celo’s proof-of-stake blockchain platform. 

These will be created independently, but all aim to make the celo dollar stablecoin as accessible as possible, bringing open finance to 5.6 billion smartphone users around the world. Particularly those excluded by existing financial services.

Celo was designed to be less difficult to use than traditional cryptocurrency platforms. Instead of wallets, public/private keypairs, and long cryptographic addresses, the Celo blockchain allows people to send payments directly to phone numbers. Transactions are held by the system if the receiving party has not been verified on the Celo network, according to the Foundation’s blog.

This works by attaching a Celo address to a phone number using what it calls “address-based encryption.” The phone number’s hash is stored on the Celo blockchain, not the mobile phone. Several phone numbers can be tied to a single Celo address.

Celo’s impressive Alliance

The Association has a number of other high-profile members such as Olaf Carlson-Wee’s Polychain Capital, Coinbase Ventures, and the Grameen Foundation. Blockchain.com and Ledger are also onboard.

The latter is based on Nobel Peace Prize-winner Muhammed Yunis’ Grameen Bank in Bangladesh, which pioneered microloans that allowed the unbanked poor to get credit and start small businesses. The Foundation’s purpose is to take the Grameen Bank model global.

“Grameen Foundation envisions a world with universal access to financial services,” said Gigi Gatti, director of technology for development at the Grameen Foundation. “We are committed to unlock financial inclusion barriers to reduce poverty and open economic opportunities for everyone. The Alliance for Prosperity gives us a fresh chance to build, interoperate, secure new financial services applications—it’s about time to cut the cost of bringing financial services to those who need it most.” 

The 50 initial members are drawn from a diverse range of industries, including blockchain and cryptocurrency, finance and venture capital, international remittances and payment processors, charitable and philanthropic organizations, telecommunications firms, and education providers.

“The power of the Alliance for Prosperity stems from its members,” said Katie Haun, general partner at Andreessen Horowitz. “Many of these organizations have on-the-ground operations that will begin to get Celo into the hands of those who have been underserved by the current global financial system. Our hope is that this partnership will start unlocking the potential of internet money.”

The Celo Foundation itself points to a number of other prominent supporters. These include Twitter and Square CEO Jack Dorsey, AngelList CEO Naval Ravikant, Autonomous Partners managing director Arianna Simpson, and LinkedIn co-founder Reid Hoffman, according to its website.

The initial members of the Celo Foundation’s Alliance for Prosperity are: Abra, Alice, AlphaWallet, Appen, Ayannah, B12, BC4NB (Blockchain for the Next Billion), BeamAndGo, Bidali, Blockchain Academy Mexico, Blockchain.com, Blockchain for Humanity (b4h), Blockchain for Social Impact (BSIC), Blockdaemon, Carbon, cLabs, CloudWalk Inc, Cobru, Coinplug, Cryptio, Cryptobuyer, CryptoSavannah, eSolidar, Fintech4Good, Flexa, Gitcoin, GiveDirectly, GSMA, KeshoLabs, Laboratoria, Ledn, Maple, Mercy Corps, Metadium, Moon, MoonPay, Pipol, Pngme, Polychain, Project Wren, SaldoMX, Semicolon Africa, The Giving Block, Utrust, Upright, Yellow Card, and 88i. 

“The Alliance’s goal is to enable more people to use digital currencies,” the organization said in a statement. “[E]mpowering anyone with a phone number towards a prosperous future.”

Updated March 11, 2020, 11:15 am with Mercy Corps quote, Ledger membership, and classification of Coinbase vs. Coinbase Ventures’ membership in the Alliance.