GIP-54: Blueprint for Goldfinch

Proposals
1

Authors: @mikesall and @blakewest

Summary

Pursuant to the reasoning outlined in GRC-02: A Blueprint For Goldfinch, we are proposing an overall strategy and approach that we think the Goldfinch community should undertake to create more usage and growth of the protocol.

Step one is for Warbler Labs to build its own successful lending business, a robo-advisor for private credit, on top of the Goldfinch protocol. In doing so, Warbler will be an early example of how to build on the Goldfinch “operating system for lending”, which will lead to…

Step two, where the community focuses on getting many others to build their onchain lending businesses using the Goldfinch operating system, which will lead to…

Step three, where the community can build a broad array of products and services that take advantage of the growing ecosystem of interoperable loans.

Motivation

See GRC-02: A Blueprint For Goldfinch, where the reasoning is laid out in detail.

Specification and Requirements

As shared in the post linked above, the summary of the Blueprint for Goldfinch is:

  1. Enable a successful lending business → Warbler will be among the first to build on Goldfinch, with a robo advisor for private credit that uses the blockchain to enhance the deals.
  2. Scale to many businesses → The community will support many businesses building on the Goldfinch operating system, which creates a network of interoperable loans
  3. Build an ecosystem of products and services → When Goldfinch has many lending businesses building on the same standardized stack, the community can take advantage of those network effects to create new products and services that support all the loans.

To summarize, we believe there’s a massive opportunity in front of Goldfinch to tackle the $1.4 trillion private credit market. However, to break out of the recent stagnant growth, the Goldfinch community needs a clear and decisive strategy that makes big changes, not incremental ones.

The goal of this blueprint is to use our learnings and advantages in the current market to create a hyper scalable evolution of Goldfinch that gives investors what they want.

Benefits

  • Alignment on a clear strategy, which helps direct community efforts and clarify what should or should not be worked on and voted on.

Downside

  • The strategy could be wrong. But that’s how all strategies are. It requires taking a stance and pursing it. It will never be obvious.

Voting

“Yes” - You agree to the general strategic approach and sequencing. The community should start building towards this.

“No” - You disagree on the general strategic approach. The community should not start building towards this.

Resources

4 Likes
2

I generally support this proposal because we need to change something with the current TVL stagnation. But I also have a few questions for @mikesall :

  1. Does this new concept mean that we won’t have any new borrower pools in the way we used to see them?
  2. How will this new Warbler Labs product work? Will we eventually have the opportunity to supply capital in your product via goldfinch app UI how it was with the senior pool?
3

In the current market conditions and at the current stage of protocol development, the strategy seems promising, so I’m going to vote “Yes”

4

I support both proposals as part of this blueprint

5

I am in favor of this proposal. A clear plan, which is exactly what we’ve been lacking.

6

To answer your questions:

  1. For the robo-advisor we’re building at Warbler Labs, that is correct we won’t be doing new borrower pools in the same way. The new system won’t prevent new pools from happening the same way as before, but I generally wouldn’t expect new lending businesses building on the Goldfinch operating system to do it that way, for the reasons described in the proposal of what investors want.
  2. The robo-advisor we’re building at Warbler Labs will be open to U.S. accredited investors, and yes any U.S. accredited investor will be able to supply capital. It will be a new UI but generally the way it will work is you will sign up, deposit capital, and then we will manage a portfolio for you and have it automatically rebalance over time for you. It will be separate pools and won’t involve the senior pool. There will still be a legacy version of the existing app.
1 Like
7

I believe this is the most appropriate time to make these kinds of changes and make Goldfinch even more efficient, so my vote is ‘Yes’.

// Yes.

8

The blueprint seems to pivot from the original whitepaper, but it is understandable that the product needs to adapt with constantly changing forces and what investors want. Establishing trust and brand is not an easy thing to do, especially when credits are defaulted on. Nonetheless, with this new blueprint and Warbler taking regulatory approach by applying robo-advisor license with SEC, and the idea of supporting many centralized lending businesses on decentralized infrastructure with focus on interoperability is very commendable. It is yet to be seen how the deals and legal stuff will flow but I am very excited about it overall.

One thing I wonder is how does the utility of GFI token fit in the new blueprint?

1 Like
9

I’m excited about this proposal and I’m happy to see a new and fresh direction for community efforts even if it requires to take on risks.

10

The Goldfinch community and protocol really need a plan to allow for sustainable growth. As I understand it, there are plans to transition from the concept of pools (when the same company could create pools at different times for different tasks as needed) to the concept of permanently functioning lending businesses based on Goldfinch. I cannot say that this plan will be 100% successful. But in any case, it is necessary to start somewhere and, in the process of analyzing activities, adjust the plan.
Various “network” effects are indeed possible, but only after achieving a certain (large) scale of development. This is a very distant planning horizon. It will be good if we can achieve this in the future.
I vote “YES”.

11

GFI will continue to serve the important purpose, as it always has, of being used for governance votes. Everything that becomes part of the Goldfinch Operating System will need to be voted on by governance. Another important element is that this blueprint includes the introduction of fee switches for both origination fees and AUM fees, and GFI holders can decide through governance votes if and when to turn them on.

1 Like
12

Council has approved the proposal.