Claude Eguienta
Mimo Capital
Ask most business leaders to explain blockchain, and depending on their backgrounds and personal involvement with this transformative technology, you’re likely to get a broad spectrum of explanations – from a description of a simple distributed ledger to an overcomplicated analysis, for which you may need the minimum equivalent of a Ph.D. in Astrophysics to comprehend. Add crypto to the dialogue, and the level of skepticism by many is instantly elevated. The negative press and allegations of outright fraud certainly don’t paint the industry in the greatest light of transparency and trust. “Those of us who have dedicated our work to this industry have two options,” says Claude Eguienta (correctly pronounced Egg-you-in-ta), the CEO at Mimo Capital, during our recent conversation. “We can abandon ship or stay and make it better, stronger and empower diverse communities through inclusive finance,” Eguienta added.
Many at the center of the crypto space are trying to change the perception of all crypto as a single industry. The disgraced FTX, for example, was a centralized exchange deposited into a black box, with a great deal of regulatory guards down conducive to misleading, half-truths, and outright scams. The industry wants decentralization to democratize financial literacy and give greater control to users of the technology. In an environment built for communal trust, creative accounting, and fraud are more detectable as a core design of the technology. It could mean the industry becomes more difficult to use for laymen, less accessible for many and temporarily forces many into the perception of niche providers.
“Some things take time, as you must lay a solid foundation with the first row of bricks of the software,” added Eguienta. “Over time, we can build layers for easier access, different restrictions, greater knowledge, and greater adoption and distributed trust in the hands of the users,” suggested this renowned expert in the finance industry. Having spent over two decades managing portfolios and leading investment teams, Eguienta is responsible for overseeing Mimo Capital’s investment strategy. As the co-founder of Telcoin and Kabotip, two previous blockchain companies, he has demonstrated a commitment to leveraging technology for financial inclusion.
Social impact certainly seems like a long reach for this leading, at times, exclusive tech. Until you learn more about this soft-spoken computer scientist focused on distributed systems. With a Caribbean heritage, Eguienta grew up with a mom who was a student at heart, spending most of her career in HR. He learned about human interactions and organizational dynamics by reading her books, and when not playing video games (his first passion), he would devour instructional books. The transformation he seeks to create through blockchain software in financial literacy and to bridge financial gaps between the haves and have-nots is ultimately a reflection of his own evolution.
A nonobvious correlation lies between gaming and crypto, as our conversation would later reveal in discussing Claude’s background. “In game leveling, you control actions and currency. In finance, you create economic incentives for users to use tokens, interest rates, you allow or restrict certain behaviors, which allows one to plan an economic ecosystem very closely to creating a game,” Eguienta added.
At Mimo, Claude and his team are attempting to provide crypto users access to real assets. At his first venture, Kabotip, he created crypto software before it was an industry. He was very focused on helping content creators monetize their content – think of an intersection of Reddit and Instagram, where every like, funds were transferred by running a secured blockchain (often referred to as miner) from your phone, and the user received payment for contributing/tipping, ramping up to 30,000 active users very quickly. As a startup, Kabotip was a great spark of creativity but not a scalable business model, and product-market fit seemed elusive.
His follow-up act in Telcoin, built with a US-based partner with a background in fraud detection from telecom, began using machine learning (ML) as infrastructure to transfer money from users, realizing the close proximity of telecom to finance. The two partners studied the movement of funds in less developed markets such as Kenya and the Philippines and built a network to send funds without border restrictions – imagine sending money like a text to a phone number. This remittance business with crypto as the backend empowered software that created less friction to adoption and dramatically amplified their regulatory expertise. As the business evolved to a greater operationalization of the relationships with large telecoms and governments than technology, Claude pushed for his partner to lead as the CEO and continues the entity to date.
Excited to tackle the next frontier, Eguienta built Mimo as a provider of a new protocol to European users to gain access to a stablecoin – any cryptocurrency designed to have a relatively stable price, typically through being pegged to a commodity or currency. In this new ecosystem, to issue a main digital asset, one needs an asset in reserve. The more assets in reserve one keeps, the cost of holding becomes increasingly unviable. So, Mimo buys productive assets in the real world, such as stocks, debt, or real estate, and issues a digital representation on a blockchain.
A simple example could be home ownership – Mimo could buy that home and issue a token – a digital representation of the home ownership. If the house is rented, tenants pay rent each month, and Mimo can give the owner of the digital token monthly rental income. A more realistic and active scenario is Treasury Bills (T-Bills), a short-term debt backed by the U.S. Treasury Department with a maturity of one year or less. A $100 T-Bill at a certain rate is bought at a discount and sold at a later date for the face value, constituting an interest rate. Mimo buys T-Bills, sells digital representations to digital T-Bills in crypto represented by the U.S. Dollar, creating a good mix of interest rates and risk profiles, and sells them to their customers.
Now imagine educating the less privileged or often the unbanked population with crypto as a tool to help them understand how financial systems work. That’s no longer difficult to imagine, as Eguienta and the team at Mimo are building software to help money move faster in an open, transparent, secured, and publicly traceable manner and reduce the friction of holding cash. Recorded transactions are public information, including how the transaction has transpired, where, when, the software, and the source code of the platform it originated from.
That’s real innovation as solutions to bridge financial gaps, exemplifying the commitment of more than a few good guys to social impact. The challenges faced by blockchain startups will require unique strategies to overcome obstacles, misperceptions, and distrust of the crypto ecosystem. Claude Eguienta is one such guiding light.
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