This is the intro of why I got involved in crowdfunding refunds. Everyone likes a refund but not everyone likes crowdfunding. If you are like me you don’t participate in crowdfunding primarily because you can’t be certain if you will actually receive anything you pay for and the risk / reward equation just doesn’t seem right. Besides that you have to wait for stuff and technology has a very short shelf life before becoming outdated. But I’m interested in crowdfunding for another reason, namely because it is an amazing candidate for a special type of insurance* product.
I became interested in insurance in 2015 when I wrote a white paper describing how insurance might benefit from leveraging blockchain technology. Peerback is the practical application of some of those insights. Peerback is interesting because it uses a number of new technologies to lower the burden of regulatory overhead. The technology which lowers these costs is novel having never been used in this way to provide refunds to consumers. Most importantly it increases the certainty that funds will be available when needed.
Regulation is a good thing, regulations keep consumers safe by protecting us from scams and bad actors. If you are a business owner you also know how expensive regulatory compliance can be, which is one of the reasons why we don’t currently have true peer to peer insurance (the regulatory overhead would be millions of dollars). But what if an insurance company could self regulate? What if an insurance company could have perfect transparency allowing anyone to audit all the financials at any time? What if no one could ever steal or misappropriate the money? What if consumers are even more safe under the Peerback model than the model of insurance licensing and regulatory frameworks imposed by the government? This is exactly why Peerback is important and its why I’m working on the project.
Peerback uses blockchain technology to provide greater transparency and to guarantee funds will be there when consumers expect to receive their refund. Our white paper details how the technology provides greater security for consumers. The problems our platform solves are many but the following are key features highlight what makes our platform unique:
- Peerback never holds customer funds
- Refunds are never held by 3rd parties removing counterparty risk or custody of funds issues entirely
- Future refunds are fully collateralized before any premiums are paid
- Anyone can prove solvency of future refund claims through the blockchain at any time
- Blockchain technology places strict restrictions on who can move these funds, under what circumstances, and places limits on who the receiving parties are.
- This isn’t technically insurance it’s a refund and refunds are regulated differently.
Below is our slide deck