Meet Tung Pham.
Tung is a product manager and lives in Vietnam.
Like many people, Tung got into crypto to protect his hard-earned savings from inflationary devaluation.
In Tung’s case, he converted Vietnamese Dong (VND) to TrueUSD (TUSD), pegging his savings to the world reserve currency, US Dollars.
Since then, Tung has been looking for a safe place to invest his savings. He wanted the same high-interest rates offered by Vietnamese banks but with the security of a stable currency.
A few weeks ago, Tung invested all his TUSD in our platform for 10% APR (as of 7 Jan 2020, the market rate is 8%) — almost double that of the highest paying Vietnamese savings account.
Earlier this week, we caught up with Tung to ask why he chose Constant.
Here’s his story.
The challenge of saving in Vietnam
In 2018, Vietnamese inflation was 3.5%. During the same year, VND devalued 2.6% against USD. This loss of buying power has forced some Vietnamese citizens, like Tung, to consider alternatives for their long-term savings.
“VND is always going to lose value,” said Tung. “Currency depreciation is one of the main drivers for increased exports so our government has no reason to stop it. That’s why many Vietnamese prefer holding USD for savings regardless of the fact that putting VND in the bank will earn them better interest than you’ll find in US banks.”
However, buying USD is complex and expensive. You need to present the bank with proof of purpose, such as traveling or studying overseas (saving isn’t an acceptable reason). The only other option is buying from the black market — not only does this cost more but you’ll pay a large fine if caught.
So Tung began exploring USD-backed stablecoins, finally settling on TrueUSD (TUSD). Long praised for its transparency, TUSD is one of the most traded USD-backed stablecoins in the market.
“TrueUSD really impressed me,” Tung said. “Every two weeks they publish independent audits that prove they have the reserves to match the TUSD in circulation. I felt I could trust that TUSD would always maintain its value.”
Earning better interest than the banks
Of course, stabilizing value isn’t the same as growing it. Tung also wanted the same low-risk returns he could get investing fiat. So, he began searching for ways to leverage his TUSD holdings. That’s when he discovered Constant P2P lending.
“I didn’t know much about P2P lending, so Constant was a pleasant surprise,” said Tung. “All loans are secured to protect investors, and I also got to choose my own interest rate. In the end, I went for the market rate of 10% as it was still higher than any I’d seen advertised by Vietnamese banks. It’s nice knowing my money is going to a person and not a bank, too.”
Constant is a fully secured peer-to-peer (P2P) that connects investors and borrowers so they can do business together on their own terms. All loans are secured by cryptocurrency collateral, so there are no credit checks, and investor returns are guaranteed. Customers can invest using fiat currencies or a range of stablecoins, including TUSD, GUSD, PAX, USDC, and USDS.
Putting Tung’s savings to work
Since investing his TUSD with Constant, Tung has been earning 10% (as of 7 Jan 2020, the market rate is 8%) APR. That’s almost double that of the highest-paying deposit accounts in Vietnam, and around 100x that of a 12-month CD from any of the five largest banks in the US.
Since all loans are over-collateralized by highly-liquid and reputable tokens, Tung needn’t worry about losing his principal if a borrower defaults. And with full control over rates, terms, and amounts, he can align his investments with his personal goals, such as buying a new motorbike or going on holiday.
“Before Constant, I didn’t realize I could earn interest on TUSD,” Tung said. “Now, I’m enjoying the stability of a stablecoin and earning double what I’d earn in a bank here in Vietnam. It’s amazing, really. I’ve even told my friends and family about it. Not just for the referral rewards, but because I believe Constant is one of the best ways to get a great rate without risking your savings.”
Tung might also benefit from the appreciation of USD against VND. When his investment ends, he can cash out his TUSD for VND at a higher exchange rate than he first bought it. As a result, Constant has been one of Tung’s most profitable investments, and he can reinvest as many times as he likes.
Constant has given Tung and many others a way to boost their savings, an interest rate that few, if any, retail banks can offer, and an opportunity to reach financial freedom safely. And that can only be a good thing.
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