Your daily dose of Austin
Smartphone image
Make your inbox more Austin.
Local news and fun, every day 6am.
An Austin group is exploring new territories in crypto by providing credit


An Austin group is bringing credit to crypto.

The group is known as Sphere DAO (decentralized autonomous organization), and it operates similar to traditional lending where factors like payment history and debt burden are taken into account. Except on their platform, it’ll involve aspects such as “wallet scores” that provide credit history and profiles for both lenders and borrowers to view traits like credit limit or interest earned.

Co-founder Ryan McNutt, speaking on a Google Meets video call while on a break from SXSW panels last week explained the personal reasons that drew him to the venture.

In a small town in Arkansas, the McNutt family needed a business loan. After trying for a month to build a relationship with a bank, his dad pitched a business and the application was denied. On the way out of the bank, McNutt’s dad saw a credit card application, and he used that to start the business that supported the family throughout Ryan’s childhood.

“Coming from that background of not having good credit and then trying to figure out a way to still succeed and then seeing this new financial system come about is kind of how this idea came into place,” McNutt said. “I was like, we could really do a lot of great things with crypto and provide credit to people who don’t have credit already.”

The other co-founder, Christopher Ries, had different routes into crypto.

His introduction came through his cybersecurity background, which involved him in the response to a hack on Sony. North Korean groups wanted to be paid a ransom and eliminate the worry of it being traced back to them, which could be achieved with crypto.

“Having exposure early on in cybersecurity and understanding how crypto was used in ways it shouldn’t be was kind of my first exposure,” Ries said. He added that it’s been a fun ride watching it take on new purposes.

The model involves various revenue streams, including late fees, membership fees and establishment fees. Plus borrower interest rates and liquidity ownership. It's something Ries describes as entirely new.

"There's really no concept of credit in crypto," he said. "There's unsecured lending where you put down collateral similar to a mortgage for a home, you can kind of pull liquidity out as well... but there is no concept of 'hey I'm a web3 builder or creator and I need credit in cryptocurrencies."

But with crypto scams being a major concern—both the FBI and FTC have warned people of suspicious activity to watch out for—Ries and McNutt are ahead on making people feel secure on the platform.

First, everything will be held in smart contracts, where the terms of an agreement are in computer code. They’ll be audited by a third party as a first line of defense and will be regularly tested for security. In a memo for potential investors, Sphere outlines potential fraud scenarios they’ve considered and mitigation plans they have for reducing fraud.

The two are looking forward to what lies ahead for the DAO. This month, they’re mainly focused on fundraising. In April, they’ll be releasing an alpha and then a private beta. Once those steps are knocked out, they’ll go forward with a public beta, possibly launching in Q3.

“I think it’s going to be amazing to see what happens a year from now,” McNutt said. “Whether it’s us or another project, credit is going to come to (decentralized finance) and it’s going to come to crypto and I think it’s going to help millions of people, if not billions, and it’s going to be freaking awesome.”


Austin's airport consumer satisfaction drops from a year ago, below Texas peers

(Austin-Bergstrom International Airport/Twitter)

Flyers are less satisfied with the Austin-Bergstrom International Airport than a year ago, a new study shows.

Research firm J.D. Power placed ABIA at No. 15 on a list ranking overall customer satisfaction at large airports, a slip from last year’s spot at No. 7. Other Texas airports secured rankings ahead of Austin, with Dallas Love Field at third, Houston Hobby at eight, and San Antonio International Airport at ninth.

Dallas/Ft. Worth ranked eight in the "mega airport" category.

Keep ReadingShow less
1923 Lake Austin mansion demolition request pitting preservationists and some neighbors against owner and city preservation office
Austin Monitor

By Jonathan Lee

The Planning Commission was split Tuesday on whether to help save an eclectic lakefront estate from demolition by zoning it historic amid concerns over tax breaks and the likelihood that a previous owner participated in segregation as a business owner.

The property in question, known as the Delisle House, is located at 2002 Scenic Drive in Tarrytown. The main house, with Spanish and Modern influences, was built in 1923 by Raymond Delisle, an optician. A Gothic Revival accessory apartment was built in 1946. The current owner applied to demolish the structures in order to build a new home.'

Keep ReadingShow less