The SmartFi Token is backed by the value of the collateral we receive for loans which includes, real estate, equipment and cryptocurrencies.
The SmartFi token (ticker: SMTF) is issued through the SmartCycle with an increasing price based on an event that is deflationary. The Smartcycle process is designed to maintain a balance between the market demand for loans and tokens traded, which maintains a continuing incremental price increase of the SmartFi Token. This creates credit and assets similar to a loanable funds model used in private banking.
The important metric to compare is the SMTF Forward Price Value. This forward price shows the potential increasing price value when all loans are funded.
SmartCycle Tokenomics of SMTF – The purpose of the SmartCycle token utilization is very different from a typical utility token. One major difference is that the tokens are not all made available at once. The SmartCycle purpose is to fund SmartFi loan demand. SMTF is made available through the SmartCycle cycling process of funding and lending on loans through the SMTF token. When the SmartFi loan portfolio increases (more money is lent out) the price of the token is increased by a preset index to fund more loans.
The SMTF SmartCycle primary market price is indexed to the increasing Total Loan Value (TLV). The increasing price of the SMTF coin reduces the amount SMTF needed fund the increasing loan portfolio.
This is a deflationary effect much like the Bitcoin halving that increases the price of Bitcoin via scarcity. Since SmartCycle is an exact index it creates a forward price curve not based on time but based on total loans funded amount. This exact price discovery forecasts the forward price of SMTF.
A few of the advantages of the SmartCycle are as follows:
1. Price increases by deflations, SmartCycle puts upward pressure on the price of the coin via deflation.
2. Better price discovery, SMTF has a forward price curve with exact correlation to the loan portfolio providing a way to forecast the future price.
3. Less risk, its model can provide a 100% buy back guarantee at the original purchase prices of SMTF on the SmartCycle tool and at designated exchanges
The current SmartCycle tranche data is bolded
Liquidity for SmartInterest withdrawals and SMTF Buy Back redemption is created by SmartFi customer loan repayment. Available liquidity varies from month to month, based on amount of proceeds available from loan repayments received by SmartFi. Current active SmartLoan demand and forecasted loan demand can be viewed in the sections above.
SmartFi at its sole discretion determines the amount of liquidity available.
Active SmartLoan - This value represents SmartLoans funded from the SMTF traded in the SmartCYCLE.
SmartLoan Demand - This value represents an agreed-to loan contract for the durations presented here. This means SmartFi needs to make enough SMTF tokens available to fund these contracted loans or SmartFi will use internal funding to complete the loan agreements. The forecasted demand amount listed here may represent SmartLoans that have been funded by SmartFi internal funding, but not yet by SMTF on the SmartCycle. SmartFi makes internal funding available so that SmartLoan borrowers receive funds immediately, without waiting for SMTF trading to catch up to demand.
For example, SmartFi seeded $40 million in active loans in the Forecasted SmartLoan Demand to start the SmartCycle. This resulted in Forecasted SmartLoan Demand that has already been funded internally by SmartFi and is waiting for the SmartFi token sale proceeds to catch up.
In-Process SmartLoan - This value is sometimes stated by SmartFi in publications and on social media to quantify potential SmartLoan growth based on loan origination activities being underwritten at the time of publication. This value is NOT included in any forecast and is an indicator only of potential new SmartLoans. This metric is not used in the SmartCycle SMTF pricing. Therefore, it is not reported here.
Total active SmartLoan amounts may vary from total SmartFi token (SMTF) trades due to approvals, funding, and closing of loans. Approval of different types of loans (crypto collateral, and other collateral types have different lengths of processing) and the funding process may be the cause of variations of reported amounts on the SmartFi Tokenomics key metrics.
Also, some discrepancies maybe caused by gaps in the availability of traditional banking services (weekends, holiday closures) or the nature of some loan settlement processes.
The good news is SmartFi’s lending activities are expanding and diversifying. More updates to come soon!
SFUSD can be redeemed on the SmartPortal for exactly one US dollar (at par) - no transaction fees. When SFUSD is minted or mined, it is produced with a value exactly correlated to USD. In addition, our SmartFi USD traditional treasury bank account balance is published via SFTP publicly every hour at SmartFi.com. This proves that the SFUSD coin is backed by at least the amount US dollars. No audit needed. Because of the US banking system is not real time some display limitation will be noticed during hours when the banking system is closed i.e., weekends holidays and evening hours. This is still far superior to other stable coins once a month or even longer audit intervals.
SmartFi does not have a profit motive for its SFUSD stablecoin reserves. Only USD is held for reserves.