A Promissory Note And The Blockchain
There are different credit notes such as cheques, bank drafts and promissory notes. However, the promissory note is the easiest and most used one among them all, as it clearly states terms and conditions of an agreement.
A promissory note is a financial instrument denoting a promise by one person or party to pay another person or party a specified amount of money at a given time. Promissory notes have been in use for a long time.
Many business people use them as they contain details of the lending agreement between the parties involved. For example, it includes the principal amount, the date of maturity and the signature of the issuer. It creates no room for doubt or questions.
With Funder One Capital the terms and conditions of the project are contained in the Project Compact, including objectives, settings and automated smart contract.
In the blockchain ecosystem, the place of the promissory note is replaced by utility tokens. For example, Funder One Capital issues out its UBETS tokens as a sign of indebtedness. It is done through the process of tokenisation of real estate. The UBETS token acts as a guarantee for the return of funds injected as liquidity in the real estate project.
The tokens are the digital bearer certificates, issued in the form of crypto assets and provide cryptographic certainty and assurance that liquidity providers will get their funds back on a future date.
Therefore, in the blockchain space, the role of promissory notes is replaced by utility tokens such as UBETS. These tokens provide a guarantee of recovery of funds invested in the project. The agreement conditions are embedded in a smart contract based on the blockchain. The generation of the smart contract means all agreement conditions are met and cannot be altered.
