If you have the MetaMask Wallet as browser plugin or mobile app, you can interact with the contract! To just play around on Ethereum's Ropsten Testnet, get some free Testnet ETH. It's also live on Ethereum's Layer 2 networks Optimism and Arbitrum, which you can add to your Metamask wallet here.
This contract allows token sellers to put their tokens into a contract, which only releases the tokens to someone who can prove that they appropriately paid the seller on some traditional digital payment service (such as Venmo, MPesa, Zelle, CashApp, PayPal...) that takes care of handling the fiat payments, as well as KYC and AML compliance. The goal is to allow anyone to freely swap between local currency inside a verified fiat account, and tokens on the blockchain.
This is a key building block needed to provide financial products (such as insurance, loans or savings accounts) to anyone in the world via the blockchain: anyone who receives capital from a smart contract could use it to do things in the fiat-world, and anyone who wants to deposit capital into smart contracts could do so - as long they use the same payment service as some individual who's willing to swap between crypto and fiat, even if the two don't trust each other.
There's a lot of spare capital parked on Ethereum. People decided to put it there because they have high hopes for the potential of the technology, and now they would love to put it to productive (and interest-earning) use. For now, there are only few "productive" use-cases for capital in the blockchain world: align the incentives of consensus participants via proof-of-stake, or provide liquidity that allows users to swap tokens, for example. But if we're honest, there's almost no way right now in which this capital could be put to productive use in the real world, i.e. to solve problems that have existed before blockchains came around. The consequence: people mostly use their capital to speculate on the prices of NTFs, ERC20s and other tokens. We think this falls fundamentally short of what blockchain capital - which is globally available and has perfect contractual security built-in - could be used for: rent it out or provide insurance to individuals who are inadequately served by existing financial and legal institutions, such as small business owners in low income countries, for example.
But we're missing some key pieces to realize this vision: Ethereum transactions must become cheap without reducing the trustworthiness of the system (shout out to Arbitrum, Optimism, ZKSync and Polygon for huge progess on this!). For loans, we need to empower people to prove to a contract that they have a clean credit history (which becomes possible with our Proof-Of-ID idea for example, but also shoutout to the Proof-Of-Humanity project!). For insurance, people need to able to prove they actually had a damage (check out our Weather-Insurance contract for an example of this!). And finally, we need to make crypto capital easily convertible to and from local fiat-currencry, wherever you are, because most of the world still runs on it. And that's what this contract is about!
Before offering any tokens for sale, the seller first computes a unique offerID from the fiat transaction details as follows (e.g. via the offerID contract function):
offerID = hash(sellerHandle, priceInCent, transactionMessage, paymentService, buyerSellerSecret)
Let's explain each of the fiat transaction details: paymentService specifies the online payment website (currently it must be the string "Venmo", but eventually "MPesa", "CashApp", etc. could be supported as well). sellerHandle is the name of the seller's account on the payment website (currently their Venmo handle). priceInCent is an integer specifying how much the buyer has to pay to the seller. transactionMessage is a string specifying what message the buyer has to use for their payment. buyerSellerSecret is a large, random number generated by the seller.
The hash function always produces the same offerID from the same transaction details, but you cannot compute the details from a given offerID in any other way than randomly trying out all plausible inputs until you find the exact set of inputs that procudes a given offerID. This means that as long as buyerSellerSecret is a large, random number known only to the buyer and seller, even someone who correctly guesses the sellerHandle,priceInCent,transactionMessage and paymentService couldn't figure out that any public offerID was produced from those fiat transaction details, because they would have to try out every possible buyerSellerSecret as well.
To make an offer to a buyer, the seller calls the offerTokens function to deposit their tokens into the contract, specifying their offerID, the Ethereum address of the buyer, and the number of seconds the buyer has to claim the offer without fearing that it could be retracted or fulfilled by someone else. Then, the seller shares the fiat transaction details with the buyer, who can compute the corresponding offerID and check (via the amountOffered function) that they would receive enough tokens for making this fiat transaction. If that is the case, they can make the specified payment, and then call the buyTokens function. This will start an oracle enclave, which first receives the transaction details from the buyer and computes the offerID. Next, it opens up the website of the payment service in an interactive session, where the user passes 2FA and captchas and shows the enclave that they made the right transaction. If everything checks out, the enclave signs the offerID along with the user's Ethereum address such that the user can submit them to the contract, which then releases the tokens to the user. If the user doesn't submit the proof of payment in time, the seller can call retractOffer to get their tokens back from the contract.
Here are some exciting ways you could improve the contract, and maybe start a business around it:
- Add more fiat payment services
- Design a market which efficiently matches buyers with sellers, maybe by finding a way to create the role of liquidity providers as in Uniswap for example.
- Integrate with OpenGSN to allow the token-buyer to start without any ETH in their wallet, enabling a trustless fiat-crypto onramp (directly onto L2!).