CP155: Funding Request for ADE Tokenization Platform Development with Innowise

[The_Phunky_One]

cp: 155
title: Funding Request for ADE Tokenization Platform Development with Innowise
authors: The_Phunky_One
contributors: Marcelo (M_ADE), Isaac (Puzunki)
beneficiary: ADE
wallet: (will be updated / added at a later date)
uses-component: CP2
technical-proposal: no
requires-onchain: yes
impacts/modifies:
status: rfc
date-proposed: 2025-03-18
date-ended: TBD

Short Summary:
This proposal seeks $164,250 in funding from the Centrifuge DAO Treasury–distributed across two major milestones with each milestone being broken into smaller payment tranches–to support ADE (Activos Digitales Estandarizados) in developing a tokenization platform for certificates of deposit (CDs) in El Salvador. ADE has established relationships with El Salvador’s regulatory bodies and state banks, positioning it uniquely to tokenize the $6 billion CD market, driving significant Total Value Locked (TVL) to Centrifuge.

ADE is collaborating with Innowise, a specialized European blockchain development firm, to build the MVP and integrate with Centrifuge. This project expands the Real-World Asset (RWA) ecosystem by bringing institutional-grade financial instruments into DeFi, establishing Centrifuge as the premier blockchain for regulated financial tokenization in Latin America.

High-Level Objective:
To develop a tokenization platform that enables the digitization and tokenization of El Salvador’s certificates of deposit, facilitating their integration into decentralized finance (DeFi) on Centrifuge, while establishing a long-term strategic partnership between ADE and the Centrifuge team and DAO for further financial product innovations. This initiative aligns with Centrifuge’s multi-chain EVM vision, ensuring integration with the largest pools of on-chain liquidity, developer tooling, and institutional investors, positioning Centrifuge as the go-to blockchain for financial tokenization.

Background of Proposal:

El Salvador’s banking system holds over $6 billion in CDs–the savings vehicle of choice–yet these instruments are illiquid and restricted to traditional finance. ADE, a newly created digital asset company in El Salvador, is collaborating with state banks to create a tokenized Certificates of Deposit (CDTs), offering:

• Liquidity & Composability: CDs become tradable financial assets in DeFi.
• Institutional Adoption: ADE is working directly with regulatory bodies and banks, ensuring compliance and seamless on-ramping.
• Tax Efficiency: Under El Salvador’s Digital Asset Law, tokenized CDs benefit from favorable tax treatment, incentivizing adoption.

To unlock this opportunity, ADE must first develop a Proof of Concept (POC), followed by a Minimum Viable Product (MVP). The requested funding will cover the costs of development, regulatory coordination, and integration with Centrifuge–with a vision for long-term collaboration between ADE and Centrifuge.

Description of Activity:

• Development of a proof of concept (POC) to demonstrate the feasibility of tokenized CDs on Centrifuge.
• Engagement with El Salvador’s regulators and private banks to refine the technical and legal framework + middleware architecture integration with banks core systems.
• Iterative development leading to a minimum viable product (MVP) that will facilitate the issuance of the digital asset commercial license approval, in order to start tokenizing institutional banks’ CDs through Centrifuge blockchain technology.
• Long-term partnership discussions between ADE and Centrifuge to scale the initiative and introduce additional DeFi primitives in El Salvador.

Risk Assessment:

• Regulatory Uncertainty:
  While El Salvador is progressive in its digital asset policies, regulatory approvals are still required.
  • Mitigation: ADE is working directly with state banks and regulators to ensure compliance.

Bank’s due diligence on becoming an official bank supplier takes a lot of time, causing delays on architecture integration

• Mitigation: ADE has been in multiple conversations with bank stakeholders, and was actually responsible for updating the bank’s legal requirements to be official digital asset providers. Plus, ADE will use sandbox environments to allow banks to test the platform before full integration, reducing perceived risks and onboarding time.

• Technical Development Risks:
  Delays or challenges in software development may arise.

  • Mitigation: Innowise is a highly experienced development firm with a proven track record within blockchain products in the institutional financial sector. Development follows an Agile methodology, ensuring iterative testing, faster issue resolution, and adaptive project management. Parallel testing and modular deployment will be implemented, allowing different components (e.g., OnchainID, Private Data Layer, Custodial Wallet) to be tested independently, reducing risk bottlenecks.

• Adoption Risks:
  State banks and depositors may be slow to adopt tokenized CDs.

  • Mitigation: The POC and MVP will demonstrate the benefits of tokenization to key stakeholders, especially in light of the tax free laws around digital assets in El Salvador. At the same time, the MVP will include a real-world test phase where select institutions can pilot tokenized CDs under controlled conditions. ADE also plans to help banks promote CDTs through mutual marketing campaigns + educational workshops and regulatory briefings with bank executives, legal teams, and institutional investors to increase adoption confidence.

• Security Risks:
  Smart contract vulnerabilities or security breaches

  • Mitigation: The platform will undergo multiple independent security audits before full deployment. Only battle-tested smart contract standards will be used. To mitigate risks from the banking side, ADE will implement tamper-proof digital footprints to track all interactions, making unauthorized changes impossible. Additionally, ADE’s infrastructure will ensure that even in the event of a breach, banks will maintain full transparency and immutable transaction records, eliminating the possibility of undetected hacks originating from ADE’s platform. Immutable transaction records will be stored on-chain, providing full auditability and preventing undetected fund mismanagement.

Sustainability:

• ADE’s long-term vision includes rolling out additional tokenized RWAs + DeFi products beyond CDs - ensuring continuous growth in adoption and TVL.
• Once the MVP is successfully deployed, the platform will generate transaction fees on the issuance, transfer, and trading of tokenized CDs reducing the need for further DAO funding.

Collaborations and Partnerships:

• ADE is directly working with El Salvador’s regulators + private & state banks to introduce tokenized CDs.
• Innowise, a Poland-based software development firm, will build the tokenization infrastructure on Centrifuge.
• Centrifuge DAO will play a key role in funding and technical guidance to ensure successful integration.
• GlobalStake is an institutional focused, enterprise grade, SOC2 Type II certified bare metal blockchain infrastructure company. Their legal team is engaged in the process of creating an El Salvador business entity to provide RPC endpoints and other necessary hardware to ensure the ADE project connects seamlessly to Centrifuge (GS currently runs an RPC for Centrifuge for free under their community label, Lucky Friday).
• GK8, an institutional-grade custody technology provider, is the main candidate to provide multi-party computation (MPC) wallet infrastructure.
• Torres Legal, a prominent legal advisory firm in El Salvador, who specializes in blockchain and digital assets law, are advising ADE. Torres has actively participated in shaping the country’s digital asset regulatory framework, including involvement in panels on digital assets and the Digital Asset Issuance Law.

Change or Improvement:

• Introduces a major new RWA category on Centrifuge, significantly increasing TVL.
• Establishes Centrifuge as a go-to platform for financial institutions exploring blockchain solutions.
• Strengthens Centrifuge’s presence in Latin America, a region increasingly adopting blockchain innovations.

Alignment to the Mission of Centrifuge DAO:

• Real-World Asset Expansion: This project aligns with Centrifuge’s goal of integrating RWAs into DeFi.
• Strategic Growth: ADE’s roadmap includes additional DeFi products beyond CDs, providing long-term benefits to Centrifuge DAO.
• Regulatory Engagement: Working with state banks and regulators ensures that Centrifuge remains compliant while expanding its institutional footprint.

Description of Group(s) Seeking Funding:

• ADE (Standard Digital Assets): A digital asset firm in El Salvador specializing in financial innovation and blockchain applications.
• Innowise: A European software development company with expertise in blockchain infrastructure in institutional financial enterprises.
• Centrifuge DAO Governance Voters / TAG: Will oversee the grant and ensure alignment with DAO objectives.

Budget:

Total ADE Invested to Date: $53,369
In short:

• $20,000 on Vision and Scope discovery phase document to Innowisee
• $16,000 Torres Legal
• $7,369 Software / data security
• $10,000 2 month MPC sandbox costs

Total Request: $164,250

• Milestone 1 ($45,000) - Proof of Concept (POC) Development
• Milestone 2 ($45,000) Part 1 - MVP Core Development
• Milestone 2 ($45,000) Part 2 - Testing & Pre-Production Deployment
• Milestone 2 ($29,250) Part 3 - Final Production Launch & Admin Panel Completion

Measurement and Evaluation:

• Milestone 1 ($45,000) Success Indicators:

• Infrastructure Setup:

• AWS, GitHub, Perimeter81

• PoC AdeWall Platform (Core):

• Demo Bank Emulator (with emulation of user entry into application and mocked API Integration)
• OnchainID creation
• CD Tokenization on deposit creation
• CD renewal, closureLoyalty Program Workflow

• uMPC Sandbox Setup:

• The platform-hosted node acts as the core signing node, ensuring that any wallet transaction signing requires explicit platform control, providing a secure and auditable signing process.
• Each node stores private key shards separately, making unauthorized access infeasible

• PoC AdeWall Platform (Custodial Wallet):

• Integration with GK8 in testnet and sandbox
• Integration of Transaction Signing and Execution.
• This component interfaces with API endpoints of an external provider´s tech stack, such as GK8 by Galaxy, in order to safely handle wallet operations for the platform, banks, and bank clients.

• PoC Private Data Layer (AdeWall PDL) The Private Data Layer provides banks with:

• PoC of a private data layer for sensitive data exchange with basic security dedicated for further extension.
• Peer-to-peer infrastructure with identity-based communication.

The PoC version considers development of a base PDL Solution for further functional extension in the MVP solution. The target is to setup a base PDL network and develop a basic node which can connect to the Network based on the given identity and can send the non-typed and non-structured abstract message through a setup secure encrypted channel with basic security setup.

• Milestone 2 ($45,000) Part 1 Success Indicators:

• PoC features extension, quality improvement, detailed review and adjustments (based on invested effort and pending development):

• OnchainID generation
• Node and wallet
• CD Tokenization
• CD Tokenization Management Workflows
• Smart Contracts Deployment
• Blockchain Indexer
• Private Data Layer
• dApp Smart Contracts

• Backend Core development including extensions and security improvements for the PDL.

• Auth microservice - combined for 2FA, KYC, Wallet
• Minting microservice
• Transfer lock mechanism
• Burning mechanism after drawbacks of tokens
• Transfer of ownership for tokens. GK8 as main candidate for solution
• Balance keeping for available tokens
• Integration with bank SDK
• PDL extension and improvements

• Testnet blockchain components release

• DEV env setup and services deployments - AWS, GitHub, Perimeter81

• Milestone 2 ($50,000) Part 2: Success Indicators:

• Backend Core development continuation.

• Continuation of bank SDK development
• Tokens management microservice
• Peer-to-peer order matching mechanism
• Analytic across token’s ownership for reconciliation microservice
• PDL extension and improvements
• PDL integration
• Providing back office endpoints for Admin Panel integration

• Admin panel

• Users Management and Support
• Basic anti-fraud and AML
• Performance monitoring
• Transactions monitoring

• PROD env setup

• AWS, GitHub, Perimeter81

• Milestone 2 ($16,250) Part 3: Success Indicators:

• Admin panel functionality completion

• Basic anti-fraud and AML
• Performance monitoring
• Transactions monitoring

• QA & Bug Fixes

• Stabilisation
• Architecture review
• Mainnet release

Delivery and Reporting:

• Milestone 1: Estimated completion 2 months after funding approval.
• Milestone 2- Part 1: Estimated completion 2 months after Milestone 1.
• Milestone 2- Part 2: Estimated completion 2 months after Milestone 2, Part 1.
• Milestone 2- Part 3: Estimated completion 1 month after Milestone 2, Part 2.
• Reporting: ADE will provide monthly progress reports to Centrifuge DAO.

Legal and Ethical Considerations:

• Full compliance with El Salvador’s financial regulations and blockchain guidelines.
• Close coordination with state banks and regulators to ensure a legally sound rollout.

Milestone-Based Funding:

• Milestone 1 ($45,000) - Proof of Concept (POC) Development - Develop and validate the feasibility of tokenized CDs on Centrifuge
• Milestone 2 ($45,000) Part 1 - MVP Core Development - Expand the POC into a functional Minimum Viable Product (MVP) with smart contract deployment and initial integrations.
• Milestone 2 ($45,000) Part 2 - Testing & Pre-Production Deployment - Further development, security testing, and deployment to a development (DEV) and pre-production (PROD) environment.
• Milestone 2 ($29,250) Part 3 - Final Production Launch & Admin Panel Completion: Complete final testing, integrate the admin panel, and launch the platform for real-world use.

Goals and Themes Alignment:

• Goal(s) Supported: Expansion of RWAs, institutional engagement, and increased TVL on Centrifuge.
• Theme(s) Supported: Financial inclusion, DeFi growth, and strategic ecosystem partnerships.

This proposal establishes a high-impact, long-term collaboration between Centrifuge and ADE, positioning Centrifuge as a leader in tokenized RWAs while unlocking billions in institutional assets for blockchain-based financial products.

Proposed on behalf of ADE by The Phunky One, on-chain ID:
4cDqRFqruFThBDcnS7pRipwoxwGqLaD3SwrFRR6kcDaLwagz

Currently helping the ADE team set up a wallet and create an on-chain ID, which will be updated on this proposal during the RFC phase.

[ImdioR]

What are your thoughts @SYZ ?

[TheMarcus]

This is an interesting proposal. Unlocking some of the illiquid $6b and porting it onto Centrifuge is certainly worthy of exploration.

Appreciate the detailed information in the proposal.

A few questions come to mind:

1. Re: regulatory uncertainty, what is the likelihood (%) that regulatory approvals will be put in place for this new platform to be legally accepted and used? And is there a rough timeline / ETA for approval?

2. Re: bank’s due diligence, how have the previous/current conversations with bank stakeholders been? Are they hesitant or eager to explore this opportunity? Have they stated any factors which would cause them resistence in adopting/participating in the platform?

3. Re: success, taking into account all the risk assessments stated, what is your realistic % that this will be a successful pilot program and something that sees further adoption moving into the future?

[M_ADE]

Hi @TheMarcus thank you for your questions.

1. Re: regulatory uncertainty, what is the likelihood (%) that regulatory approvals will be put in place for this new platform to be legally accepted and used? And is there a rough timeline / ETA for approval?

**(90%+) We have talked to several top officials. Most importantly however, we remain continously engaged with a mandated presidential commissioner who answers only to The President of The Republic. Although DASP licenses can take up to 6 months, ours can take significantly less time because the office of this commissioner considers that our blockchain-to-bank integrations will also simplify and accelerate Salvadoran capital repatriation. **

CDTs have a predecessor in the stock exchange called CDNs, we were told that those took 4 months to get first time approvals by the central bank and the financial superintendency. We estimate that it can take us more or less the same amount of time for first time approval.

2. Re: bank’s due diligence, how have the previous/current conversations with bank stakeholders been? Are they hesitant or eager to explore this opportunity? Have they stated any factors which would cause them resistance in adopting/participating in the platform?

We’ve held several meetings with the bank’s legal department, head of capital markets, head of BD for new products and the senior marketing team. Once we complete our working prototype, we will contact their tech team in order to begin applying for regulatory approvals for the product.

3. Re: success, taking into account all the risk assessments stated, what is your realistic % that this will be a successful pilot program and something that sees further adoption moving into the future?

The pilot has several beneficial circumstances in its favor; CDTs are simply an upgrade of the most popular investment product in our capital markets. Banks have highly trusted brands with their customers whom they keep engaged through various promotional and marketing efforts. The Senior Marketing team has identified several specific promotional channels for the product. We are confident in this product adoption; the largest surety bond issuer is interested in understanding how our CDTs may be used as collaterals for surety bonds.

Its important to note there is a seasonality renewal concentration of CDs in March - 40% and 40% in September, while the other 20% is dispersed across all months of the year. So it’s imperative that we are operating before March 2026 in order to maximize our conversion rates. If the bank we are working for some reason presents any delays within our desired timeline, we do have a backup state bank we can plan to address.

Additionally, CDs over $25,000 benefit from tax exemptions, making them particularly attractive for businesses and high-net-worth individuals seeking efficient capital allocation.

[TheMarcus]

Right on. All positive and optimistic responses to my questions. Thank you for answering them.

I also watched your presentation during the gov call on Wednesday. Well done.

I would certainly vote in favor of this proposal.

[ImdioR]

Good day.
@SYZ, during the gov call, asked some important questions that remained unanswered.
Would you mind answering it?

Q:

• Let`s assume that POC and MVP work well and that we scale it up at that juncture from 6-12 months. What kind of TVL can we expect? What kind of interest can we expect? What will be the take rate and then the distribution of those gains between Centrifuge? What is the return on spending $165k$?

[ImdioR]

Thank you for sharing your proposal with the Centrifuge community!

As the Treasury Advisory Group, we’re excited to see this initiative.

There was a nice discussion and there was a lot of feedback raised during the Centrifuge Governance Call #34 January.
The TAG is curious to ask you some additional questions:

1. Do you already have investors who are ready to use digital investments in CDs instead of paper investments?
2. What is the profit on your side once the technology is built?
3. How will you onboard new clients?
4. Who is the audience, and who is your target money? What is the average CD deposit that you expect will be tokenized per deposit?
5. Is there a demand for CDs in DeFi? Why should they go through a Centrifuge instead of a normal paper flow?
6. Since Centrifuge DAO will be financing (if the proposal passes) the development of the software, who will own it? Centrifuge DAO, ADE, External Devs?
7. In your MVP modelling, what are the fees that will be paid to Centrifuge DAO for using the Centrifuge technology?

Thank you in advance.
Best.

[Puzunki]

Re: Let`s assume that POC and MVP work well and that we scale it up at that juncture from 6-12 months. What kind of TVL can we expect? What kind of interest can we expect? What will be the take rate and then the distribution of those gains between Centrifuge? What is the return on spending $165k$?*

We want to join your community and we take very seriously the alignment of your goals and ours. We think we c an and should be reciprocally helpful; for that reason, we would like to know more about your goals, milestones with respect to the KPIs you have set for yourselves. That being said, regarding TVL, we hope to migrate $200,000,000 USDs from CDs to CDTs in the first year. As we mentioned when answering Matthew’s questions, this goal involves risks and challenges that we must engage with the utmost seriousness and sincerity.

Banks are required to publish their financial statements on a monthly basis; for at least the last two years, their March publications reveal more granular details of their periodicity; the March publications from both years show that around 40% of all CDs had yearlong lock up periods, and 40% had 6 month lock up periods; we take this to mean that we have two significant shots for CD to CDT migration every year.

With this in mind, ADE can fully understand if Centrifuge wants to take a hit or miss approach when handling the community’s exposure to risks related to ADE’s commercial success. But if this is the case, it may be better for us to set expectations for 2026. That said, we are looking to partner with Centrifuge and aim at a business opportunity with such revolutionary potential; Centrifuge will not bear the lion’s share of the risk, ADE’s founders have made a modest investment so far, but with the right talents onboard, we will invest much more aggressively. At this stage, we consider that money is less of a factor for success than talented partners, but money can be a worthy instrument to commit talented partners, and to that end:
In return for the grant we seek to host the entire secondary market infrastructure for CDTs in the Centrifuge Ecosystem. Presently this means two things:
A new kind of AMM for the trading these cash equivalents
An overcollateralized lending dApp that feeds
Regarding revshare percentages of said infrastructure’s swap fees and interest rate spreads between Centrifuge and ADE, we believe Centrifuge would be entitled to a considerably higher share. I have worked on two prototypical mathematical formulas for both the AMM’s algorithm, and the lending dApp. I would very much like to discuss them with financial engineers and money market experts from the community.

[Puzunki]

Tag Questions:

Re:1. Do you already have investors who are ready to use digital investments in CDs instead of paper investments?

Yes. For the better part of a year, I have participated as an observer in the board of directors of a cemetery endowed with a very modest 8 figure perpetuity fund. The overwhelming majority of the portfolio is composed of CDs. The Salvadorean Digital Asset Issuance Law waives all capital gains taxes from any and all blockchain-native digital assets; in the case of the legacy CDs currently in the market without an origin on-chain, the ministry of finance applies a 10% on the capital gains of CDs whose value is greater than or equal to $25,000 USD. The smallest CDs in the perpetuity fund’s portfolio have 6 figure face values, and the largest ones 7 figures. They are interested, and like cemeteries, mid-size companies in sectors such as real estate are some of the typical customers who often hold CDs that exceed the $25K threshold.

Regarding investors who currently hold legacy CDs that are smaller than that, converting them involves each banks’ confidential commercial, promotional, and treasury strategies. However, in our conversations with bank treasurers and their senior marketing teams, they have expressed confidence in CDT adoption below the $25K threshold; particularly because of the fact that, by design, CDTs can provide better opportunities for their customers who may seek financial assistance in a plethora of situations inside and outside their individual relationship with each issuing bank.

Re:2. What is the profit on your side once the technology is built?

In the early stages of our company, we seek to collect basic fees from a small spread of the assets’ yield. The fees we are talking about here are issuance fees and digital asset custody fees. The use of proceeds from said fees must prioritize the sustainability of our on-chain and off-chain computational costs, quality assurance for our integrations, payroll, and ADE’s liquidity recycling commitments to the secondary market infrastructures. When thinking of a net income from these fees in particular, we prioritize ADE’s growth and sustainability; our business also requires a complex treasury strategy for the handling of cryptocurrency reserves; if a utility token or a cryptocurrency we use in our workflows increases in value, so do our operating costs.

We do not think a lion’s share of secondary market swap fees and interest rate spreads should go directly to ADE; instead, we believe those should mostly be kept by Centrifuge, and whatever amount of revenue from these earnings that does go to ADE we are willing to receive as CFG tokens in order to grow our reserves and have “skin in the game,” so to speak.

Re:3. How will you onboard new clients?

Banks have made great advances in selling their legacy CDs through their online and mobile platforms. In an annual publication during 2024, Banco Agricola, for example, published that $251,500,000 USD are already paperless legacy CDs they have managed to sell from their online and mobile platforms. We plan to embed our technology to these platforms via browser extensions and in-app extensions.

Re: 4. Who is the audience, and who is your target money? What is the average CD deposit that you expect will be tokenized per deposit?

CDs above the $25K threshold are likely the first ones to be converted to CDTs. CDs below the threshold will likely be segmented differently by each bank; that said, the average client profile of each bank will also have its own weight on the order at which each segment can be targeted. Arriving at an average CDT value may well depend on the bank that manages to collaborate with us the fastest.

Re: 5. Is there a demand for CDs in DeFi? Why should they go through a Centrifuge instead of a normal paper flow?

We do not envision clients visiting a DeFi UI/UX front-end to purchase a bank’s CDTs. Banks want and should have control of the store-front; they are already having great success in selling legacy CDs successfully on their new online platforms and mobile apps. That said, we can join you in engaging with our bank partners if you’d like to try to push both of our brands into the banks’ storefront, but that should certainly not be a make or break condition to negotiate with these institutions.

Re: 6. Since Centrifuge DAO will be financing (if the proposal passes) the development of the software, who will own it? Centrifuge DAO, ADE, External Devs?

We have financed the initial designs of the platform, and we will finance more development alongside Centrifuge’s grant in the PoC stage and beyond. Also, if Centrifuge does choose to collaborate with us, then we would give back any excess cash from the grant in the likely event that development takes less hours than what was estimated by our service providers—the help that Centrifuge Devs can provide in the integration of the tech stack they have developed cannot be factored in a priori. With your help, for example, an integration of your PDL into our architecture’s workflows can hopefully be much faster. Furthermore such tool and any adaptation or renovation they experience in this process will belong to you

Centrifuge will fully host the on-chain secondary market infrastructure for what will hopefully soon replace the most significant legacy bank saving product for the Salvadorean economy; ADE can have a tokenomic exposure to any income from that as we accumulate and hold CFG token reserves. After all, Centrifuge must have an economic interest to help us grow on-chain secondary market liquidity; we must keep working together to continue innovating undeserved capital markets with impactful blockchain and financial applications side by side. Furthermore, as EVM blockchains upgrade with time, we believe Centrifuge’s particular areas of expertise make them the right party to bear the responsibility of updating this particular on-chain infrastructure in order to keep it secure, and computationally sustainable for the transactions and assets we ambition to attend.

ADE must have full ownership of the off-chain multilayered infrastructure; regulated financial institutions will contractually hold us responsible to maintain and operate the full solution sustainably. The computational and operational expenses of this part of the tech stack will be borne by ADE; we will also be responsible for quality assurance on this side of the stack, as it is of our design. Furthermore, El Salvador is currently plagued with Cybercrime against local corporations and regulated institutions. We need to keep this part of the infrastructure safe from crime in coordination with all parties who participate in our collaboration. In addition to managing its own operations, ADE will need to manage the coordination of application specific cybersecurity practices between the banks, GlobalStake, GK8, and Centrifuge.

[Kate_Bee]

Thank you for these detailed answers.

The Treasury Advisory Group is working on a recommendation and will communicate it in the coming days.

Kate (TAG lead)

[The_Phunky_One]

Looking forward to it…thanks, Kate!

[ImdioR]

Thank you for providing the answers.

1. Can you provide more marketing information? Banco Agricola is a good start; can you provide a more detailed breakdown of the market?
2. Will the group that builds the back end be the same group that builds the front end?
3. Do you have any leads who will provide XYZ$ immediately once the product is launched?

[Puzunki]

Market Information: Detailed Breakdown of El Salvador’s CD Market

According to the most recent financial superintendency report (February 28, 2025):

Current TAM: $6,359,200,550 USD expire within a year

Bank	Expires Within a Year	% of TAM	Expires in More Than a Year
Banco Cuscatlan	$1,035,629,400	16.29%	$35,191,430
Banco Davivienda	$1,011,568,030	15.90%	$66,472,520
Banco Agricola	$1,000,104,830	15.72%	$106,365,400
BAC	$884,393,250	13.91%	$102,789,820
Banco Hipotecario	$649,609,810	10.22%	$199,658,400
Banco Promerica	$440,810,870	6.93%	$45,760,690
Banco Azul	$355,879,950	5.60%	$16,007,630
Banco Atlantida	$354,404,850	5.57%	$170,234,410
Banco Industrial	$314,990,590	4.95%	$7,663,450
Banco de Fomento Agropecuario	$110,561,070	1.74%	$33,100
Banco De Apoyo Integral	$103,426,550	1.63%	$3,575,570
Abank	$97,821,350	1.54%	$23,031,300

Total Value of CDs in Circulation: $7,135,984,270 USD

In the above table, the top four banks are quite advanced in their online renovations, all of them offer CDs online; Agricola, however, may well be the bank that’s been offering CDs online the longest. Those four banks may well be the ones that are most advanced in SOAP to REST migrations.

That being said, we consider that all banks are addressable issuers. Banco Promerica also offers CDs online. Banco Azul might have the most advanced Core Banking System. Banco Atlantida is by far the most aggressive bank when it comes to tokenization; they are currently focused on real estate tokenization, however, for this reason the particular renovations we’d like to have available to us when engaging with their tech stack would likely bear a much lower priority. Furthermore, Atlantida offers CDNs through the Salvadorean Stock Exchange. As per the latest report, they have about $20 Million USD of CDNs in circulation, and those comprise 100% of all CDNs in circulation.

Abank is small, but their former CTO made great tech advancements, and that bank’s current president is a close friend of mine; the president of Abank owns the investment bank I worked with for 2 years before starting ADE. Samuel is an aggressive visionary, and a mentor of mine. This is important when thinking of degrees of prioritization by a bank’s core tech team. In terms of go to market speed, they have solid potential to be a dark horse.

Banco Hipotecario and Banco de Fomento Agropecuario are state banks whose upgrades over their tech stacks can be substantially accelerated. After all, our efforts are in full alignment to two important points the national agenda; namely, digital asset issuance, and the repatriation of capital from Salvadoreans living abroad.

Lastly, regarding capital repatriation, Banco de Apoyo integral seems to be most aligned. Their website provides quick access to FATCA documentation, which undeniably shows that Salvadoran Americans are an important target for them. That being said, they recently ascended from being a SAC to become a fully licensed bank; few Savings and Credit Corporations, or SACs have online banking portals–this one is not the exception. Their tech stack may well be missing all we require, but considering their strong alignment with the national agenda and their impressive speed of ascension to becoming a fully licensed bank, we believe they should not be counted out as addressable issuers.

The Financial Superintendency regulates credit institutions via three categories in the following order: Fully-Licenced Banks, Coop Banks, and SACs. Banco de Apoyo Integral leaped from the bottom to the top last year. With this in mind, we consider that tech-wise, the SAC called Multimoney is already an addressable issuer with $96,984,200 USD expiring within two years. Likewise, the coop bank called Comedica with $201,244,600 USD is also an addressable issuer; however, most of their CDs, $168,109,600 USD to be more precise, will expire in more than a year’s time.

Development Team Structure

Re: Will the group that builds the back end be the same group that builds the front end?

As we mentioned previously, there is one bank with whom we’ve gone farthest; there will likely be little involvement from teams outside the bank’s, in any case it is their prerogative. However, we also mentioned that we have been addressing all banks. When looking at the market breakdown in my answer to your previous question, it can easily be inferred that some banks might require more involvement in front-end development than others. Not sure if that answers your question; if it doesn’t, I apologize and wait for a more specific question.

Initial Client Commitments

Re: Do you have any leads who will provide XYZ$ immediately once the product is launched?

Certifying that someone will commit XYZ$ immediately once the product is launched, would not only be potentially dishonest, but also wildly inappropriate for someone in my position; I do have to address the leads part of your question, considering that I am intimately related to some of the leads I have mentioned.

I am more than a mere observer of the cemetery with the modest 8 figure perpetuity fund. I currently hold voting power for two seats in the board of directors, the annual shareholder’s meeting is this month. I cannot write in a public forum about my private conversations with our partners. I can however say this:

If I take a seat in that board, I would recuse myself from decisions involving CDT purchases. However, CDTs fit the perpetuity fund’s mandate, which not only preceeds my involvement even as an observer, but I am also certain will remain in perpetuity. The cemetery may be a good lead because CDTs will also have the eyes of a President and a Financial Vice-President of two of the four largest Insurance Companies. Insurance Companies are larger holders of CDs than the cemetery.

My experiences with both of the two senior executives I just mentioned goes well beyond the cemetery; our families often invest together, and we have held controlling stakes in banks and insurance companies that we have successfully realized. I am the youngest to join them; they are also great mentors of mine.

I hope I have answered the questions to your satisfaction; if I haven’t, then I hope you give me the chance to answer the questions you have more specifically. Have a happy weekend