Token-based smart contract-managed decentralized lending processes that manages a set of loan process stages
A loan process smart contract manages a collateralized loan process for a loan against a collateralized item, the collateralized loan process including tokenizing and locking a collateral token that tokenizes the collateral item, managing distributed stages of authentication, appraisal, and safekeeping of the collateral item, monitoring terms of the loan, and detecting an unlocking event of the loan for unlocking the collateral token.
1. A method comprising:
receiving, by one or more processing devices, a request to initiate a loan process from a user device, the request indicating a collateral item of a borrower, the collateral item comprising a unique collectible item;
executing, by the one or more processing devices, a loan process smart contract instance that includes computer-readable instructions that are configured to manage a loan process in accordance with a loan process workflow, wherein the loan process smart contract instance is configured to execute the loan process workflow that includes:
instantiating an appraisal smart contract instance that includes computer readable instructions that are configured to facilitate an appraisal task that is performed by one or more appraisers to appraise the collateral item and to issue an appraisal notification upon confirming an appraisal report indicating an appraised value determined by the one or more appraisers;
instantiating an authentication smart contract instance that includes computer readable instructions that are configured to manage an authentication task that is performed by one or more authenticators to authenticate the collateral item and to issue an authentication notification upon confirming receipt of an authentication report generated by the one or more authenticators;
instantiating a safekeeper smart contract instance that includes computer readable instructions that are configured to manage a safekeeping task of the collateral item by a safekeeper and to issue a safekeeping notification upon confirming receipt of a safekeeper report from the safekeeper of the safekeeping of the collateral item;
initiating tokenization of the collateral item, wherein tokenization of the collateral item includes:
generating a virtual representation of the collateral item, wherein the virtual representation includes the appraised value, a description of the collateral item, and one or more media contents that respectively depict at least a portion of the collateral item, wherein the one or media contents comprise a photograph, a video, an image, or an audio clip;
generating, by the one or more processing devices, a collateral token corresponding to the collateral item, the collateral token cryptographically linked to the virtual representation of the item, wherein the collateral token is a digital token that is stored on a distributed ledger and is redeemable for the collateral item; and
assigning the collateral token to a first user account of the borrower on the distributed ledger; and
facilitating a negotiation of loan terms between the borrower and a lender by enabling exchange of offers and counteroffers of loan terms between the borrower and the lender via a user interface presented to the borrower and the lender, wherein the loan terms include a loan amount, a loan term, and information relating to the collateral item;
receiving a loan agreement notification indicating one or more loan term parameters of a loan agreement that was agreed to by the lender and the borrower, wherein the loan term parameters include the loan amount and a set of unlocking events, wherein the set of unlocking events include:
a loan repayment event that defines a first set of electronically verifiable conditions that must be met to determine that the loan has been fully repaid and
a loan default event that defines a second set of electronically verifiable conditions that must be met to determine that the borrower has defaulted on the loan;
locking, by the one or more processing devices, the collateral token by assigning the collateral token from the first user account to an escrow account on the distributed ledger, the collateral token remaining assigned to the escrow account until an unlocking event of the set of unlocking events is detected, whereby the collateral token is prevented from being redeemed or assigned to another account while the collateral token is locked in the escrow account;
monitoring, by the one or more processing devices, a repayment status of the loan in accordance with the loan term parameters to detect an occurrence of the unlocking event;
in response to detecting an occurrence of the loan repayment event, (i) unlocking the collateral token and assigning the token to the first user account of the borrower, whereby the collateral token is permitted to be redeemed by the borrower or assigned to another account by the borrower, and (ii) transmitting, by the one or more processing devices, a loan payoff notification to each of the borrower and the lender indicative of the loan repayment event and the unlocking; and
in response to detecting an occurrence of the loan default event, (i) unlocking the collateral token, and (ii) initiating a loan default workflow, the loan default workflow including transmitting, by the one or more processing devices, a loan default notification to each of the borrower and the lender indicative of the loan default event.
2. The method of claim 1 , wherein the loan process workflow is defined in a system-level governance document that is stored on the distributed ledger, wherein the system-level governance defines a condition to initiate the appraisal task.
3. The method of claim 1 , wherein the loan process workflow is defined in a system-level governance document that is stored on the distributed ledger, wherein the system-level governance defines a condition to initiate the authentication task.
4. The method of claim 1 , wherein the loan process workflow is defined in a system-level governance document that is stored on the distributed ledger, wherein the system-level governance defines a condition to initiate the safekeeping task.
5. The method of claim 1 , wherein the loan process smart contract instance instantiates the appraisal smart contract instance in response to receiving an authentication notification indicating that an authenticator has authenticated the collateral item and deemed the collateral item as authentic.
6. The method of claim 1 , wherein the loan process smart contract instance instantiates the safekeeping smart contract instance in response to receiving an authentication notification indicating that an authenticator has authenticated the collateral item and deemed the collateral item as authentic.
7. The method of claim 1 , wherein the loan process smart contract instance instantiates the authentication smart contract instance in response to receiving a safekeeping notification indicating that the item is in safekeeping.
8. The method of claim 1 , wherein the loan process smart contract instance instantiates the appraisal smart contract instance in response to receiving a safekeeping notification indicating that the item is in safekeeping.
9. The method of claim 1 , wherein the authentication report is generated from a form template that is defined in accordance with an authentication stage-level governance that defines a set of rules and regulations associated with performance of the authentication task.
10. The method of claim 9 , wherein the authentication stage-level governance defines an authentication task workflow, wherein the authentication task workflow includes one or more conditions that must be met to complete the authentication task and trigger a next stage in the loan process workflow to which the loan process adheres.
11. The method of claim 10 , wherein the authentication stage-level governance is at least partially defined by an authentication guild to which the authenticator is a guild member.
12. The method of claim 11 , wherein the authentication guild includes a plurality of different specialized authentication guilds, wherein each specialized authentication guild specializes in authenticating a respective type of collateral item.
13. The method of claim 12 , wherein the plurality of different specialized authentication guilds includes at least a subset of the group comprising: a watch authentication guild that specializes in authenticating watches, a shoe authentication guild that specializes in authenticating shoes, a handbag authentication guild that specializes in authenticating handbags, an art authentication guild that specializes in authenticating works of art, a sports memorabilia authentication guild that specializes in authenticating sports memorabilia, a toy authentication guild that specializes in authenticating collectible toys, a jewelry authentication guild that specializes in authenticating jewelry, a clothing authentication guild that specializes in authenticating designer clothing, an instrument authentication guild that specializes in expertise authenticating musical instruments, a record authentication guild that specializes in authenticating rare or collectible records, a wine authentication guild that specializes in expertise authenticating units of wine, a whiskey authentication guild that specializes in authenticating units of whiskey, and an automobile authentication guild that specializes in authenticating limited edition automobiles.
14. The method of claim 1 , wherein the authentication smart contract instance is further configured to:
generate a data block containing the authentication report and a cryptographic hash value that is generated based on the authentication report; and
write the data block to the distributed ledger.
15. The method of claim 1 , wherein the appraisal report is generated from a form template that is defined in accordance with an appraisal stage-level governance that defines a set of rules and regulations associated with performance of the appraisal task.
16. The method of claim 15 , wherein the appraisal stage-level governance defines an appraisal task workflow, wherein the appraisal task workflow includes one or more conditions that must be met to complete the appraisal task and trigger a next stage in the loan process workflow.
17. The method of claim 15 , wherein the appraisal stage-level governance is at least partially defined by an appraisal guild to which the appraiser is a guild member.
18. The method of claim 17 , wherein the appraisal guild includes a plurality of different specialized appraisal guilds, wherein each specialized appraisal guild specializes in appraising a respective type of collateral item.
19. The method of claim 18 , wherein the plurality of different specialized appraisal guilds includes at least a subset of the group comprising: a watch appraisal guild that specializes in appraising watches, a shoe appraisal guild that specializes in appraising shoes, a handbag appraisal guild that specializes in appraising handbags, an art appraisal guild that specializes in appraising works of art, a sports memorabilia appraisal guild that specializes in appraising sports memorabilia, a toy appraisal guild that specializes in appraising collectible toys, a jewelry appraisal guild that specializes in appraising jewelry, a clothing appraisal guild that specializes in appraising designer clothing, an instrument appraisal guild that specializes in expertise appraising musical instruments, a record appraisal guild that specializes in appraising rare or collectible records, a wine appraisal guild that specializes in expertise appraising units (e.g., barrels or bottles) of wine, a whiskey appraisal guild that specializes in appraising units (e.g., barrels or bottles) of whiskey, and an automobile appraisal guild that specializes in appraising limited edition automobiles.
20. The method of claim 1 , wherein the appraisal smart contract instance is further configured to:
generate a data block containing the appraisal report and a cryptographic hash value that is generated based at least in part on the data block; and
write the data block to the distributed ledger.
21. The method of claim 1 , wherein the safekeeping report is generated from a safekeeping form template that is defined in accordance with a safekeeping stage-level governance that defines a set of rules and regulations associated with performance of the safekeeping task.
22. The method of claim 1 , wherein the safekeeping smart contract instance manages a safekeeping task workflow in accordance with a safekeeping stage-level governance that defines the safekeeping task workflow, wherein the safekeeping task workflow includes one or more conditions that must be met to complete the safekeeping task and trigger a next stage in the loan process workflow.
23. The method of claim 22 , wherein the safekeeping stage-level governance is at least partially defined by a safekeeper guild to which the safekeeper is a guild member.
24. The method of claim 22 , wherein the safekeeping stage-level governance defines a safekeeping smart contract from which the safekeeping smart contract instance was instantiated.
25. The method of claim 1 , wherein the safekeeping smart contract instance initiates an escrowing of a monetary amount of currency tokens and/or tokenized tokens from an account of the safekeeping to the escrow account in response to receiving the safekeeping report, wherein the monetary amount of currency tokens and/or tokenized tokens is equal to or less than an appraised value determined by an appraiser of the collateral item.
26. The method of claim 25 , wherein at least a portion of the escrowed amount is locked in the escrow account until the loan process is complete.
27. The method of claim 1 , wherein the safekeeping smart contract instance is further configured to:
generate a data block containing the safekeeping report and a cryptographic hash value that is generated based at least in part on the safekeeping report; and
write the data block to the distributed ledger.
28. The method of claim 1 , wherein the loan process smart contract instance is executed at by a set of node devices that store the distributed ledger.