Coinbase CEO: On-chain reputation will replace traditional credit scoring

According to Be In Crypto, Coinbase CEO Brian Armstrong stated that on-chain reputation will become a new generation of credit scoring systems, potentially replacing the FICO score that currently dominates 90% of top loan decisions in the United States. Armstrong pointed out in response to Base founder Jesse Pollak that public ledgers can now record repayment history, wallet age, and counterparty behavior, and any lender can access the same on-chain record.

Currently, Ethos Network has scored wallets through user endorsements, and based on this score, the lending application Credifi can offer unsecured loans of up to $3,000 to wallets with scores reaching 1,800. However, on-chain addresses are not tied to real identities, and borrowers can create new wallets at any time, so whether on-chain reputation can effectively price real risks remains to be validated by subsequent default rate data.