Celo uses an on-chain public key infrastructure that links phone numbers to public keys, making it easy to send money to your phone’s contacts, whether or not they have a crypto wallet yet. There is no lengthy “onboarding” for new users – all you need is a phone and some crypto. Celo is a proof-of-stake (PoS) layer 1 blockchain network complete with a virtual machine that facilitates smart contract and decentralized application (dApp) development and deployment. The Celo ecosystem can be used to issue stablecoins, such as cUSD, via an algorithmic stablecoin collateralization model. In addition, the amount of value passed through mobile phones is growing each year, even without digital assets being accounted for. Complete cryptocurrency market coverage with live coin prices, charts and crypto market cap featuring coins on 750 exchanges.
That means the collateral backing the cUSD is a mix of CELO and other cryptocurrencies. Any validators that don’t act in the best interests of the network can be penalized economically. Plus, since the validators are elected by Celo holders, any validator that doesn’t act in the best interests of the community can be replaced by the votes of the community. Naturally the validators are compensated for the role they perform in the network.
- Celo uses an on-chain public key infrastructure that links phone numbers to public keys, making it easy to send money to your phone’s contacts, whether or not they have a crypto wallet yet.
- The protocol that provides the cUSD with stability is a hybrid seigniorage and crypto-collateral model.
- In fact, just a week after that Dutch auction CELO started trading at just $0.83 and the highest level it has reached is $4.73 on September 4, 2020.
- While Celo appears very simple for the users, on the backend it is just as technically sound as any competing blockchain project.
- The traditional financial system is known for its gatekeepers and restrictions, limiting our access to our assets and preventing many people from accessing basic financial services altogether.
For example, even though many of these areas have never had fixed line telephones, or dial-up internet, they are now saturated by cell phones and other mobile devices. The overriding objective of Celo is driven by the mission and goals of the Alliance of Prosperity. Celo doesn’t just want to be the first mobile-friendly, highly-secured blockchain network. It wants to accomplish this in order to expand on its mission to improve financial inclusion and prosperity for citizens in all parts of the world who traditionally have been excluded from the financial system. The Celo Dollars or cUSD are the Celo stablecoin that is meant to enable stable transfer of value between users. It is backed by reserves of other digital assets like Bitcoin and Ethereum and is pegged to the price of the U.S. dollar.
Rather than using complex, long strings of letters and numbers as blockchain addresses, users of Celo are able to send and receive cryptocurrencies using their mobile phone number. To make use of mobile phones the Celo protocol was created to be lightweight and fast. And with over 6 billion mobile devices globally it was https://cryptolisting.org/ also made to be scalable. And with the Celo infrastructure operating across many different carriers and countries, it enables access to financial services from almost any mobile phone in the world. Celo also removes the barrier of complexity for new users, by enabling you to use your phone number as your public key.
Yet it’s a market that cannot easily access the benefits of crypto or DeFi. This website is using a security service to protect itself from online attacks. There are several actions that could trigger this block including submitting a certain word or phrase, a SQL command or malformed data. Unfortunately for early investors that level is between $1.50 and $1.70, which is far below the average price of $5.02 that was paid for cGLD during the May 2020 Dutch auction on Coinlist. In fact, just a week after that Dutch auction CELO started trading at just $0.83 and the highest level it has reached is $4.73 on September 4, 2020. Celo is accepted as the first major blockchain project that has made social impact the core of its mission.
The team at Celo made the decision to use the mobile phone because it is so ubiquitous and understood. While some areas of the world haven’t received the cabling for internet or even for landline phones in 2020, the people that live in these areas do have mobile phones in many cases. Celo also offers the Celo Dollar – the platform’s native stablecoin backed by CGLD in reserve, and capable of maintaining a stable value via Celo’s algorithmic protocol. Celo’s native token Celo (CGLD) is also an on-chain governance token that can be staked on Celo’s proof-of-stake protocol, making passive income accessible to anyone. This also means anyone with the token can have a say in how the platform evolves and grows over time. Blockchains are known for their relatively slow transaction speeds, as they struggle to download transaction history data before exchanging funds.
Voting on protocol changes is also done by locking up CELO in the same smart contract. Again, the voters are able to recall their CELO after a waiting period of three days has elapsed. There are currently two native crypto assets that are used in the Celo network. While the Celo app is the preferred way to send Celo Dollars (cUSD), the platform’s stable coin, it is not needed. Users can send cUSD via WhatsApp if they like, however in order to receive the cUSD the recipient will need to download and install the Celo wallet (currently available for Android only).
How Does Celo Work?
Still, that’s quite inexpensive when compared with Cosmos for example, where it requires 10,000 ATOM (over $50,000) to become a validator. Given the publicity this news has brought, perhaps today’s move in CELO isn’t surprising. However, those interested in what Celo and the cGLD crypto are may be intrigued to learn more. Let’s dive into a few things investors may want to know about this crypto platform. This type of adoption is going to be necessary to see growth in the CELO token, which has been sadly resistant to the December rally in Bitcoin and other large cryptocurrencies. The protocol that provides the cUSD with stability is a hybrid seigniorage and crypto-collateral model.
What is Celo?
In the future the team has said they will expand the stablecoin offerings to the cEUR and cGBP among others. Even though the cost is prohibitive for many, Celo is looking for ways to make it more affordable to run a validator. Currently that includes a multi-tiered system of validators, nodes, and light clients. The Celo community has also proposed increasing the number of validators into the millions, cgld coin but currently there are a maximum of 100 validators on the network. Celo is currently using a Byzantine Fault Tolerant consensus algorithm where a defined set of validator nodes are used to reach agreement on the validity of transactions posted to the network. This consensus method can reach agreement on the validity of transactions even when one-third of the nodes are malicious, faulty, or offline.
This leading decentralized finance platform is currently being used for an intriguing initiative. Today, it was announced that mobile-focused blockchain Celo is launching a $100 million “DeFi for the People” fund. This fund aims to bring DeFi and dApps to the 6 billion smartphone users globally.
So, when the price of cUSD is above $1 arbitrageurs are expected to purchase CELO and exchange it for cUSD, then sell the cUSD to collect the profit. For those who can’t or won’t run a validator there is an option to stake coins by delegating to the validators. Unfortunately it is still a fairly complex operation even to delegate since it needs to be done through a command line interface. They are responsible for protocol changes, providing security audits, and supplying the hardware and software necessary to keep the network running. One downside to the validator network is the cost of running a validator node, currently estimated to be over $15,000.
Celo Dollars can be minted or burned at any time to maintain stability and the peg to the U.S. dollar. It is through this fixed supply cryptocurrency that Celo maintains price stability, as well as most of the governance operations of the blockchain. The Celo team consists of dozens of individuals from all over the world and from multiple disciplines that include software development, blockchain engineering, marketing, business, finance, and others. It’s this broad, deep experience base that has recommended Celo as one of the top projects to watch in the blockchain space. We tried it out to see if it really worked as advertised by the Celo team and found that it truly is a simplified way to interact with a blockchain and cryptocurrency.
Using mobile phone numbers as addresses also allowed the team to develop a blockchain with far lower resource usage when compared with many modern blockchain solutions. This low resource design is key for increasing usage in areas where resources are scarce. To understand the value of Celo and its ecosystem of services, we need to look first at how it’s designed to be used. CELO is a mobile-first blockchain designed to unlock the power of crypto for absolutely everyone, without any additional hardware. The traditional financial system is known for its gatekeepers and restrictions, limiting our access to our assets and preventing many people from accessing basic financial services altogether.
These are ERC-20 tokens that were sold in Dutch auction on Coinlist on May 12, 2020. Outlets such as Coinbase also received cGLD tokens at the time as a payment for their early investments into Celo. The cGLD tokens were unlocked when the Celo mainnet launched and can be exchanged for CELO or for cUSD. Light clients are able to choose the specific full node they wish to service them and this can be based on location, cost, reliability and other factors to optimize cost and quality of service. Rene started his career in global capital markets at Morgan Stanley and also worked at McKinsey, the World Bank and TechnoServe. He earned a diploma in finance from Germany’s WHU and a MBA from MIT Sloan.