Gypsy is a decentralized mortgage protocol that helps import $2T worth of stable mortgage bonds into the DeFi ecosystem. By tokenizing the largest asset class in the world (real-estate mortgages), we aspire to provide stability to DeFi.
DeFi and yield farming need an underlying layer of stability. Current stable coins are not backed by any real asset (USD itself is not backed by much). Truth is, DeFi and the real world are completely untethered. Our ambition is to change that. Complexity of problem: We aim to bridge largest most stable asset class in the world to DeFi. Mortgage backed securities (MBS) valued at $2T are completely untapped. Our demo is the first step in making this happen. How are we solving it? We create NFTs of home-titles as a collateral for MBS bonds. We allow investors to purchase MBS bonds, while enabling home-buyers to secure a Web 3.0 loan. Practicality: We make MBS purchase for investors and home-mortgage applications as easy as 1-2-3 clicks. Anyone with a Metamask wallet can get up and running in minutes. Originality: Gypsy is novel in that it uses an NFT title as collateral for the loan. Mortgage loans that currently exist in DEFI require the borrower to over collateralize their loans with crypto assets. The protocol is able to provide capital up front for the loan as compared to other decentralized lending protocols, by using Propy's NFT title as collateral that handle the registrations transfers via SPV's to maintain legal standings with local governments. Wow factor: Bringing the largest most stable asset class in the world to DeFi.
How it's made
A Lender is an entity that lends crypto assets to the Gypsy treasury. Deposited crypto assets are pooled and used to buy a home that the borrower has the mortgage for. The borrower then pays fixed monthly payments to the mortgage (with interest) to remain in the home. Lenders purchase MBS in with ETH, wBTC, and stable coins. The MBS tokens represent a depositor's share of the revenues generated by the protocol. Gypsy Protocol distributes Gypsy Tokens as incentives for lenders. Borrowers are entities that take out mortgages to buy real estate on the blockchain via NFT titles provided by Propy. These borrowers are required to pay back the loan with a fixed interest payment every month for the duration of the loan. Propy acts as the bridge between defi and traditional markets. Propy creates NFT home titles that are backed by real titles. If a user brings their NFT title to Propy, they are able to burn the NFT and exchange it for the real title. The Gypsy protocol uses these NFT titles as collateral in the mortgage loans.