Interview: SUKU CEO Says DeFi’s Real Beneficiary Has Yet to Be Reached

Interview: SUKU CEO Says DeFi’s Real Beneficiary Has Yet to Be Reached

SUKU started as a 'supply chain service as a service' platform, before discovering a significant financial gap.
Neither the author, Tim Fries, nor this website, The Tokenist, provide financial advice. Please consult our website policy prior to making financial decisions.

SUKU is building what they refer to as the “supply chain of tomorrow”. The platform is positioning itself as the link between “open finance, traceability, and transparency”. While initially aiming to build a global supply chain solution, the SUKU team realized they could help farmers, manufacturers, distributors, and consumers in other ways as well.

Much of this revolved around a lack of access to common financial products and services—not just banking, but lending as well. Based on this observation, SUKU went on to launch SUKU DeFi, which focuses on micro lending and collateralization.

The Tokenist recently sat down with Yonathan Lapchik, SUKU CEO, to dive into SUKU DeFi.

Tokenist: Hello Yonathan, thanks so much for taking the time to speak with us today. SUKU DeFi is doing a lot of really cool things in the world of finance, but it all started with SUKU’s supply chain, which is maybe where we should start as well. How much adoption is SUKU’s supply chain solution experiencing? Which markets and industries is SUKU’s supply chain seeing the most success?

Yonathan: We are getting a lot of traction on the food and fashion industries, where the need for transparency, sustainability and demand from conscious customers is the highest.

Tokenist: SUKU DeFi seems to focus primarily on microloans. How exactly do you define a microloan – and how do they function within SUKU’s ecosystem?

Yonathan: A microloan is a loan of a smaller amount than a bank or other financial institution can generally provide. There are 1.7 billion people who lack bank accounts and therefore do not have access to traditional bank loans. Microloans of a couple-hundred dollars or less could be precisely what a person needs to pay for a piece of equipment or other materials essential to their business.

SUKU’s DeFi micro-lending platform is designed to incentivize small suppliers—local farmers and craftspeople based outside of the US—to participate in sharing supply chain data as part of SUKU’s transparency solution for brands and retailers. 

Tokenist: What benefits do decentralized microloans bring to supply chain participants?

Yonathan: When a supplier provides data inputs to the SUKU Ecosystem to verify product transparency, they will gain access to DeFi services through the SUKU DeFi protocol. This capability could provide many small farmers, local craftspeople, and others underserved by the traditional financial industry with new potential revenue streams and access to financial services that would not otherwise be available to them.

Tokenist: What are the different assets that SUKU DeFi utilizes? 

Yonathan: The SUKU token serves as the collateral for micro farmers to access microloans in the form of stablecoins such as USDC.

Tokenist: DeFi seems to be growing at a rapid pace, at least in terms of total value locked (TVL) and the quantity of different platforms that are becoming available. Yet, for several reasons, it still seems quite far from mainstream use. SUKU represents something unique, where DeFi is coupled with an existing real-world business application: supply chain management. Is this the sort of thing that’s needed to accelerate DeFi adoption?

Yonathan: At the moment, current DeFi participants are not necessarily the people who can most benefit from DeFi services. Many DeFi protocols require access to an internet-connected device to participate, and yet 40% of the global population are not active internet users. Of those who do have internet access, many lack awareness of the opportunities available through DeFi. We’ve addressed both of these issues in our solutions. We are developing TextMeCrypto to allow for the sending and receiving of cryptocurrencies and microloan requests to all occur over SMS—no internet connection required. Small farmers who are participating in SUKU’s supply chain solution gain access and knowledge of the SUKU DeFi microlending platform. In this way, we are leveraging the connections to small farmers via product supply chains to further DeFi adoption to those who can benefit from these services the most.

Tokenist: How can someone who is not part of a supply chain contribute to SUKU DeFi? Can individuals, for example, contribute liquidity to SUKU DeFi’s asset pool? How does that work – and what’s the incentive for such individuals?

Yonathan: Yes, users who supply assets such as SUKU, USDC, and wHBAR (wrapped HBAR) on the protocol get an APY every time a borrower borrows on the platform using the assets they supply.

Tokenist: I’ve read on your website that “SUKU tokens are not meant for U.S. persons”. Why is that so, and will U.S. persons have access in the future?

Yonathan: SUKU is not intended for US persons due to regulatory constraints in the US. Unfortunately, we can’t comment on future access.

Tokenist: SUKU recently announced a partnership with Hedera Hashgraph. What does that partnership entail?

Yonathan: We migrated SUKU OMNI and INFINITE solutions to Hedera Hashgraph because of the much lower fees on Hedera compared to Ethereum. For example, minting an NFT on Ethereum costs about $80 compared to $1 on Hedera. Hedera’s Token Service will be used in a similar way to the non-fungible ERC-721 token standard on Ethereum.

Tokenist: Is there anything we didn’t discuss that you feel is vital to share with our audience?

Yonathan: No, thanks!

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