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What Is PandiFi?

To begin, we should make clear the distinctions between the different areas of "PandiFi", some of which may confuse new users.

  • The PandiFi DAO: The entity which developed the PandiFi protocol, the web interface, and PandiFi Loan Vault LLC.
  • PandiFi Loan Vault LLC: The company which takes legal posession of loans and faces third party vendors like mortgage servicers.
  • The PandiFi Protocol: A suite of persistent, non-upgradable smart contracts that together facilitate peer-to-peer market making and swapping of digitized loans on the Ethereum blockchain.
  • The PandiFi Interface: A web interface that allows for easy interaction with the PandiFi protocol. The interface is only one of many ways one may interact with the PandiFi protocol.
  • PandiFi Governance: A governance system for governing the PandiFi Protocol, enabled by the PANDI token.

Introduction#

The PandiFi protocol is a peer-to-peer system designed for exchanging digitized consumer loans and mortgages on the Ethereum blockchain. The protocol is implemented as a set of persistent, non-upgradable smart contracts; designed to prioritize censorship resistance, security, self-custody, and to function with an absolute bare minimum of trusted intermediaries who may selectively restrict access.

Version 1 of the PandiFi protocol is scheduled to be released on December 1, 2021. It is open source with slight modifications, the terms of which are viewable here. Each version of PandiFi, once deployed, will function with in perpetuity, with 100% uptime, providing the continued existence of the Ethereum blockchain.

PandiFi's Values#

  1. Our mission is to make consumer lending decentralized, fair, and free of rent-seeking middlemen to the extent possible. Full stop.
  2. PandiFi is community driven and consumer driven. While PandiFi, Inc. is structured as a U.S. corporation, we believe the protocol and UI design should be driven by our users. If there is ever a conflict between PandiFi, Inc. shareholders and PandiFi tokenholders/users, we'll buy back outstanding shares, collapse the corporation, and restructure as a not-for-profit foundation.
  3. Digitized loan holders control servicing. PandiFi is a service whose aim is to make loan distribution more efficient. PandiFi does not assert any rights to control servicing in any way. In fact, digitized loan investors have the right to choose a sub-servicer and the right to make decisions about loan servicing, including modifications.
  4. Smart contracts should not be upgradable. While there are various approaches to making upgradable smart contracts (e.g., Proxies), we believe this is a bad design pattern for DeFi products. Investors should be able to diligence a set of smart contracts once and have confidence thereafter that the rules-of-the-game won't change when they're not paying attention. A new deployment of PandiFi smart contracts will be explicitly labeled V2, V3, etc.
  5. Transparency is paramount to healthy financial markets. PandiFi will disclose as much information as possible about its digitized loans, borrower privacy laws notwithstanding.
  6. Complexity is bad. We believe that DeFi structures should be as simple as possible. Moreover, there should be as few barriers between investors and borrowers as possible. This is good for investors because they can easily conceptualize the risk/reward tradeoffs. And this is good for borrowers because they don't need to pay additional fees to middlemen.
  7. Blockchain technology is just a tool. Blockchain technology is just one tool in our arsenal. If some off-chain tool is better for consumers, we will use it even if it isn't cool or novel. If its good for investors and consumers, then it's a force for good in our book.
  8. That said, blockchain technology is going to revolutionize consumer lending markets.