Zivoe｜DeFi Protocol Specializing in Consumer Credit Markets

Zivoe aims to democratize credit access by replacing high-interest loans with low-interest ones in the underbanked market, a market underserved by traditional financial institutions. Focusing specifically on the U.S. subprime personal loan market, Zivoe seeks to provide financial freedom to users by refinancing excessive interest rate debt into manageable low-interest loans.

The protocol works by having liquidity providers deposit stablecoins such as USDC, USDT, DAI, and FRAX, and receive senior or junior tranche tokens. These tokens can earn yield through staking. The funds are sent to originators who underwrite consumer credit, and the loans generated are transferred to a Special Purpose Vehicle (SPV). This SPV repays the interest to the protocol, which is then paid to the liquidity providers.

1. Why is Zivoe necessary?

Traditional financial institutions have not adequately served people with low credit scores (the underbanked), and many are forced to rely on high-interest loans. High-interest loans contribute to trapping borrowers in a cycle of debt. Zivoe aims to solve this problem by providing more sustainable financial solutions.

2. Specific benefits of Zivoe

Borrowers

• Low interest rates: High-interest debt can be refinanced into lower-interest loans.
• Flexible repayment plans: Repayment plans can be tailored to individual circumstances.

Lenders

• High yield: Staking can provide a higher yield than traditional financial products.
• Social contribution: Contribute to financial inclusion (the effort to make financial services accessible to everyone) and a more equitable society.

3. What are Tranche Tokens?

• Senior Tranche: A safer debt instrument with lower default risk but also a lower yield.
• Junior Tranche: A higher-risk debt instrument with higher default risk but also a higher potential yield.
• Risk and Return: Tranche tokens offer different risk and return profiles, allowing investors to choose based on their risk tolerance.

4. The Role of the SPV

• Loan Management: Manages the loan receivables generated from the project and diversifies risk.
• Interest Payments to the Protocol: The SPV pays the interest earned from the loan receivables to the protocol, which is then distributed to tranche token holders.

In July 2024, Zivoe raised a total of $8.35 million in a funding round from investors including Andrew Keys, Iceberg Capital, and Concave.

Zivoe has issued a governance token called ZVE. Holding this token allows participation in protocol improvement proposals and asset management. The total supply of ZVE tokens is 25,000,000, and token holders gain voting rights through the protocol's DAO.

Zivoe's mainnet launch event, the "Initial Tranche Offering (ITO)," is scheduled to run from August 22nd to September 21st, 2024. Participants who deposit stablecoins during this period will receive corresponding tranche tokens. Participants will also receive an airdrop of the protocol token ZVE, with 5% of ZVE tokens distributed on a 1-year linear vesting schedule.

For example, as shown in the image above, depositing 100 USDC into the Senior Tranche will earn 100 zsTT + 300 pZVE, and depositing 100 USDC into the Junior Tranche will earn 100 zsTT + 100 pZVE.

Summary of Steps

1. Launch the app on the website
2. Connect your wallet
3. Select the tranche type and stablecoin type, enter the amount, and deposit.

Detailed Steps with Images

1. Launch the app on the website
2. Connect your wallet
3. Select the tranche type and stablecoin type, enter the amount, and deposit.