Glo: The Anti-Poverty Dollar
By: Seth Ariel Green & Bram Voets
Note: Glo is currently in alpha. We're not yet making or donating money. When we say that Glo reduces extreme poverty, invests in T-bills, or generates basic income, we're talking about how Glo will be once we come out of alpha. Learn more.
The role of stablecoins
Fiat-backed stablecoins are controversial among crypto natives. On the one hand, their combined $150+ billion market cap suggests that they’re meeting a real market need, and they’ve shown relative resilience during a crypto downturn. On the other, the fact that they’re backed by centralized issuers means that someone can pull the plug, or have it pulled on them, and cut off access to vulnerable users.
We don’t have a definitive answer to this. What we can say instead is that as long as there are centralized stablecoins—and they are likely to be around for the foreseeable future—we might as well ask: “cui bono?” (who benefits?). Right now, stablecoin issuers benefit from a great business model. They invest about 80% of their assets in safe government bonds – typically Treasury Bills – which earn about 3.37% interest per year. That comes to about a 2.7% return on market cap, year after year. And if you have a $10 billion market cap, that’s $270 million a year. As of 2018, 86% of the largest stablecoin’s assets were under the control of four men, although we don’t know what the number is today.
We think there’s a different way to do things. That’s the idea behind USDGLO (Glo for short), the first nonprofit stablecoin.
Why Glo is Different
Like many other stablecoins, Glo is pegged to the US dollar and backed by a combination of cash and Treasury Bills. The Glo difference is that its annual yield of 2.7% goes directly towards fighting extreme poverty. This is made possible through donating 100% of proceeds to GiveDirectly, an NGO that provides cash transfers to people living in extreme poverty.
With Glo, every time you buy or use the stablecoin, you're making a difference in someone's life, automatically, at no financial cost to yourself.
Decentralized autonomous organizations (DAOs) can also make a positive impact by choosing Glo as their stablecoin of choice. Between them, DAOs have treasuries totaling over $12 billion. If they converted just 10% of that to Glo, they’d transform the lives of over sixty-six thousand people (see this article for how we make these calculations).
If Glo becomes the third largest stablecoin, it will lift one million people out of poverty annually. At 8% of all money, we’d effectively eradicate extreme poverty.
A Path to Social Responsibility
Glo is just one of many projects working towards a better future – others include Gitcoin, GoodDollar, and ReFi DAO. We’re proud to be part of a movement of people who take crypto altruism seriously.
We think ending extreme poverty is possible in our lifetimes. And when we do, so many other seemingly intractable problems—hunger, lack of access to education, inequality, and others—will become much more solvable. Step one is to make the best possible stablecoin, and to bring in all the utility of conventional currency.
Join the Movement
Glo is more than just a stablecoin. It's a movement towards a better future, where every purchase makes a difference.
Whether you're an individual or a DAO, your involvement can help bring the movement to life. If this resonates with you, please join our early adopter program at glodollar.org/get-started. Read more about the program here.
About the authors
Seth Ariel Green is a writer living in Brooklyn. He has a master’s degree in political science and has mostly worked in startups. His non-work interests include veganism and adventure time.
Bram Voets, originally from the Netherlands, is a marketer who resides in Berlin. With a five-year background at Google, he is currently dedicated to driving growth at Glo, committed to ending extreme poverty.
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