Citing the fact that the 42 richest people on Earth have more wealth than the poorest 3.7 billion, social trading platform eToro made an announcement this week that it is supporting the social good through a new project. The Israel and London-based company’s new initiative, GoodDollar, is a non-profit, open source project that seeks to reduce income inequality with a new cryptocurrency.
And the GoodDollar project is already off to a good start. eToro announced it has injected $1 million into the project and is calling for more innovators to join in. GoodDollar leverages smart contracts, which help parties transparently exchange money, property, shares, or any unit of value. Overall, the project aims to use a new cryptocurrency to establish universal basic income (UBI) by paying “social interest” to individuals who have less. To reduce wealth inequality, GoodDollar will operate on four basic principles: its available to anyone, exchangeable with other currencies, has low transaction fees, and is fairly distributed across wealth segments.
“We believe that we can create a mass-market cryptocurrency that is engineered to reduce inequality and provide a UBI. Engineers, product designers and economists are currently developing the prototype. Today is just step one on a long, ambitious journey,” said Yoni Assia, eToro CEO.
Aside from building a robust user base, the most challenging aspect GoodDollar may face is maintaining a cryptocurrency that is neither inflationary nor speculative. GoodDollar will also need to come up with a global KYC alternative and design a structure to govern the cryptocurrency.
Founded in 2007, eToro demonstrated CopyFunds for Partners at FinovateEurope 2017. Since then, the company announced that clients can now invest directly in shares on the platform, and raised a $100 million in Series E round in March, more than doubling its funding to $162 million. Most recently, eToro began supporting IOTA and Binance cryptocurrencies.