As announced at last year’s Cardano Summit, we have achieved something that we never could have hoped for in our wildest dreams. We signed an MOU with Conselho Municipal da Beira (the Municipality of Beira), Mozambique. In partnership with Casa Real and Sociedade de Desenvolvimento Urbano da Beira (Beira Urban Development Company); who are supported by the Dutch government; we now have the mandate to finance lease-to-own contracts for 25,000 homes in an upcoming development called Maraza. Seeing on the ground institutional buy-in at this level for our Cardano based solution is a watershed moment for the Empowa project.

The success of our first NFT sale, coupled with the Maraza opportunity, has sparked the interest of more traditional investors in the space, such as DFIs (Development Finance Institutions).  Being considered by large institutional investors is an important step towards being able to scale the Empowa ecosystem and address the backlog of 50 million homes in Africa.

We have also considered your feedback following the release of our first NFT, which has helped us to prioritise what we focus our efforts on.  The overwhelming feedback from the community centred around these three key questions:

  • How can I support Empowa housing projects using my $EMP token?
  • How do I get a return for holding the token?
  • How can I continue to support Empowa housing projects without having to spend more money?

To address this feedback and to enable us to unlock the large amounts of capital available through institutions, our Quantitative Analytics and Risk team (led by Andrew Forson) have been working on a model in which the EMP utility token is used to collateralise Empowa’s affordable housing loans.   

Using the property itself as security for a loan (a common traditional approach) adds legal complexity, significant delays, and unsustainable expense to our decentralised approach for raising capital. The traditional land as security approach will also be impossible for us to sustain across all the countries within our potential market.  Perhaps most importantly, property in our target markets are not very liquid.  This lack of liquidity embeds that risk in the cost of a loan.  By using Empowa’s novel approach to collateralisation, which leverages our EMP token, we ensure our ability to scale across multiple countries while providing investors a liquid form of security. 

The Quantitative Team have devised a model that:

  1. Sets a price index for housing units, measured in EMP;
  2. Embeds physical characteristics of the houses being collateralised, as well as variations based on country, within the index; and
  3. Enables housing developers seeking funding to calculate the baseline amount of EMP required (actual amount may be negotiated during financing) to collateralise their project’s property types.

This collateral model provides a new opportunity for EMP token holders, as they will now be able to support housing developers to meet their collateral obligations.  We are therefore exploring different ways to enable this support, including the following:

  • Locking some of the supply to enable us to capitalise our platform at current market prices to provide greater platform stability.
  • Introducing an ecosystem-wide collateral pool (a Collateral Treasury) to minimise the impact of a single project default.
  • In the future, create instruments that allow non-developer participation in the provision of collateral.

This model can be viewed here

The mechanisms by which these collateral support features will be introduced to the Empowa ecosystem are actively being worked on and we will continue to provide updates as they progress. 

The first of these mechanisms; to be introduced soon; will be Collateral Support Vault.  The Vault will lock up supply, which along with the demand for new project collateral will support the value of EMP used for collateral.   

Like other similar products, upon launch EMP holders will be invited to lock their tokens in our smart contract.  Returns will be paid using a percentage of net income generated through the Empowa platform.  To allow The Vault to properly support the described collateral model, a sufficient number of projects need to be active within the Empowa ecosystem.  Until this level of utilisation is achieved, a degree of risk exists for developers and project funders. 

We therefore plan to initially supplement The Vault returns through the use of some of the Operating Fund token allocation, so that the protocol is also contributing to this early stage risk. As more projects are funded and other collateral support mechanisms are introduced, more returns will be generated through platform net income, reducing (and eventually eliminating) the need to use the protocol owned risk allocation to contribute to vault returns. 

As The Vault returns are correlated to platform-wide project activity, they will be shared across everyone participating in the EMP pool.  The amount of individual return will therefore depend on the total amount of EMP locked for a particular period.  We are also exploring the possibility of providing additional rewards through incentive programs, such as lockup periods and NFT staking. 

The introduction of The Vault is an exciting development, as it allows our community to support on the ground developments, 100% in EMP and earn returns while they HODL their $EMP. 


Will my locked EMP be used as collateral and therefore be at risk?


At this stage only housing developers are required to contribute EMP as collateral, which serves as first-loss security against their loan, with the amount based on the Empowa Housing Index valuation for their project and any negotiated variation to that base valuation by those funding the project.  We are exploring the introduction of a portfolio-wide collateral treasury function at some point in the future, where EMP holders will be invited to contribute to the collateral pool. The mechanism by which the collateral treasury will work has not yet been established, so we do not have a timeframe for when it will be introduced.

The Vault does not add any risk of loss in the event of a housing project default.  However, like similar services, other risks do exist that anyone participating should be aware of, such as smart contract risk or market fluctuation while EMP is locked.

How is RealFi loan collateral different from DeFi collateral?

We’ve written an article addressing just this question, click here to read it.

How does The Vault provide support for project collateral?

For funders to have confidence that the negotiated amount of collateral contributed by housing developers to underwrite their project will hold sufficient value to cover a significant portion of their loss in the event of a default, it is important to minimise market volatility in EMP, as the form of collateral being provided.

As The Vault locks up a portion of the available EMP supply, it is one factor that can provide a stabilising effect.  The amount of EMP required to provide this support takes into consideration the current circulating supply, total collateral for all active projects and the number of projects contributing to platform net income.  As the number of projects in the Empowa ecosystem increases and the portfolio-wide collateral requirements for them change, the dynamics within The Vault service (e.g. total amount locked, APY, etc.) will be adapted accordingly.

How much of the protocol owned risk allocation will be used to supplement The Vault?

We are cognisant of not allowing the protocol owned risk allocation to adversely affect the stability we aim to achieve through The Vault.  We have therefore set a fixed amount of 500,000 EMP, to be made available over a 12 month period.  This allocation will be reviewed after 6 months to determine whether adjustments need to be made, based on project growth and vault requirements.

The amount drawn each month to contribute to returns will be calculated based on the total returns payable and the net income contribution for that period.  As more projects join the Empowa ecosystem, the net income as a percentage contribution to the Vault returns should increase, allowing the amount drawn from the protocol owned risk allocation to decrease accordingly (subject to the circulating supply’s influence over pool size).

If net income will be the primary source of The Vault's returns, how will it be determined?

Empowa has various potential revenue streams, which may vary by project.  For example, the Casa Real project that financed homes for 30 families last year, provided revenue through an establishment fee and monthly processing fees.

Net income will therefore be based on platform generated revenue, less expenses incurred in the platform delivery.  As revenue sources may vary by project, we are exploring the best way by which to provide reporting on net income contributions to The Vault.

You can watch a video that covers this topic here.

When will The Vault be available?

To allow us to bring The Vault to the community as soon as possible, we are delighted to announce that we have partnered with Genius Yield.  The team at Genius Yield have developed a platform that allows different projects to offer a similar service, without needing to implement the required smart contracts themselves.

Our decision to partner with Genius Yield in the delivery of, was primarily driven by the high-quality standards their team operate under and the confidence they provide in the security of their services.  For more information about Genius Yield, visit their website at

While an exact date for the launch of The EMP Vault through the Genius Yield platform is subject to team resource availability at both Genius Yield and Empowa, we are currently hoping to launch by the end of April.

What is the APY?

We are currently exploring the option of varying returns based on lock up periods or for the inclusion of Empowa FCNFTs.  We will therefore confirm the different APYs closer to the launch of The Vault.

Can you help me understand how the introduction of both collateral and The Vault impacts the $EMP token?

Given the fixed supply of $EMP, as more of our token is locked away; as either housing project collateral or through locking in The Vault; the available supply decreases.  As we finance more developments there will be more demand for $EMP to underwrite the development and secure the loan.

Also, depending on how different platform revenue sources are paid, the proportion of net income attributed to The Vault that is accrued in anything other than EMP (e.g. USD, ADA) will need to be exchanged for EMP on the open market.  This will also contribute to the demand for EMP.

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