Celo (CELO)

Basics

• Based in: San Francisco
• Started in: 2017
• Testnet release: 7-2019
• Mainnet release: 19-5-2020 but their genesis block was on 22-4-2020
• A crypto startup building a cryptocurrency, stablecoin, and digital wallet service aimed at developing countries, has raised $30M led by Andreessen Horowitz's A16z; Celo previously raised $6.4M to develop its suite of products; its Android app is currently piloting in Kenya, Tanzania, and Argentina.

History

• cLabs has proposed its governance to turn Celo into a Ethereum L2 (16-7-2023).
• From Bitcoin.com (13-3-2020):

"Some members of the Libra Association are now backing a rival project called Celo, which has its own blockchain and cryptocurrency. Over 50 major companies have pledged their support, each pursuing a diverse set of use cases. The project claims that the combined reach of all members exceeds 400 million people."

• Celo started out as a blockchain ecosystem idea optimized for mobile phones.

Audits & Exploits

• Bug bounty program can be found [insert here].
• Celo completed a security audit, conducted by research group TrailOfBits, for its codebase.

Bugs/Exploits

• From Blockthreat (23-11-2021):

"On November 21, 2021 Celo’s Optics bridge was compromised after an unknown party activated a recovery mode giving them access to all funds locked in the contract. cLabs team alleged insider threat as a likely culprit."

Governance

• From Our Network #26 (19-6-2020):

"The validator set in the protocol remains decentralized, with 62 unique validator groups electing at least one validator as of Thursday, 6/18/20. Registered validators hail from around 40 countries, allowing the network to have significant geographic distribution (source: Polychain Labs). Six governance proposals have been submitted successfully since network launch, including one proposed by the Celo community to rename the native asset on the network from cGLD to CELO. The first community proposal passed with 96.7 percent voting in favor."

Admin Keys

• From Messari (24-6-2021):

"Changes are managed via the Celo Governance smart contract. This contract acts as an "owner" for making modifications to other protocol smart contracts. Such smart contracts are termed governable. The Governance contract will at first be owned by a multi-signature wallet. In the future, when the community's experience of DAOs (Distributed Autonomous Organizations) has evolved and when the platform has proven to be stable and secure, it will be owned by CELO holders effectively acting as a DAO."

Treasury

• From their docs (1-2021):

"The required portion of gas fee, known as the base, is set as base = gas_price_minimum * gas_used and is sent to the Community Fund."

• From Messari (24-6-2021):

"The network will also feature an ongoing issuance in the form of epoch rewards (batch of block rewards). Epoch rewards will distribute the remaining 400 million CELO of the one billion max supply. At the end of each epoch, 75% (300 million total) of newly issued assets will go to network validators, while the Community Fund (24.5%) and a carbon offsetting fund (0.5%) receive smaller portions."

Token

Token allocation

• Has a supply cap of 1,000,000,000.00.
• From Messari (24-6-2021):

"As for Celo's inflation rate, the proposed target curve (subject to change) of epoch rewards declines linearly over 15 years to 50% of the total 400 million CELO dedicated to ongoing issuance. After this first 15 years, the inflation rate decays exponentially with a half life of h=ln(2)×15=10.3h. This model does not incorporate changes to the rewards multiplier, which is a governable adjustment factor that can account for underspending or overspending.

1. Founders & Project 44.5%
2. Airdrop % rewards 35%
3. Investors 20%"

Inflation

• According to a Messari report (Q3-2023) it has 1.4% inflation at that time.
• From a commissioned Messari report (1-11-2023):

"The annualized inflation rate of 1.43% measures the rate of staking rewards compared to the genesis supply total of 700 million tokens. This rate is set to remain at 1.43% until 2035, when it will then begin decreasing and eventually go to zero."

Utility

• From Messari (24-6-2021):

"It serves as a utility that enables users to participate in network consensus (through its Proof-of-Stake system) pay for on-chain transactions, and vote on governance decisions."

Burns

• Burns 80% (1-11-2023) of the base fee, see for more info below under Fees. The first ever CELO burns occurred in Q4 2022, reducing CELO’s annualized inflation rate by 1%.

Token Details

• CELO (formerly Celo Gold)

Stablecoin 

• Has a native stablecoin, the Celo Dollar, cUSD.

Tech

• A review of their whitepaper can be found here
• Code can be viewed here.
• Consensus mechanism: Proof of stake
• Algorithm:
• Virtual Machine: EVM compatible
• Development language used:

Transaction Details

• Capacity (TPS):
• Latency: block time of 5 seconds (24-6-2021)

 How it works

• From a Nansen quarterly report (29-9-2022):

"The Celo project aims to build a financial system that is inclusive for all, with its ability to facilitate payments between any phone number in the world. This is achieved via an ultra-light client that connects a device to a full node, enabling anyone to connect to the Celo Network with minimal data requirements.

Celo also revolves around the core idea of Regenerative Finance (ReFi), which is a proposed financial model to develop and build while maintaining a positive environmental impact and allowing communities to flourish."

• From their docs (1-2021):

"Celo uses a gas market based on EIP-1559. Every transaction is required to pay for gas at or above the gas price minimum in order to be processed. Full nodes will reject transactions whose gas price is below the current gas price minimum, and will discard outstanding transactions if the gas price minimum subsequently falls below the gas price that the transactions specify. The required portion of gas fee, known as the base, is set as base = gas_price_minimum * gas_used and is sent to the Community Fund. The rest of the gas fee, known as the tip, is rewarded to the validator that proposes the block."

• From Messari (24-6-2021):

1. "Fast & light transactions (block headers optimized for fast mobile phone synchronization).
2. The ability to send currency to phone numbers (lightweight identity protocol that maps hashes of phones numbers to public keys-- making it easier for anyone with a mobile phone to send and receive digital currencies to anyone in the world)
3. Automatic deduction of transaction fees and the option to pay gas (as low as $0.01) in stable currencies."

Fees

• From a commissioned Messari report (1-11-2023):

"The Gingerbread Hardfork, completed on September 26, implemented CIP-52. The proposal introduces a new system for how revenue is distributed. Previously, the base fee of a transaction was sent to a Community Fund while the tip was rewarded to the block proposer.

Under the new system, 20% of the base fee is allocated to a new Green Fund. The Green Fund will start as a multi-sig and will receive the existing assets in the Celo Carbon Offset Fund. Its purpose will be to turn assets into onchain Regenerative Finance (ReFi) initiatives, such as buying carbon credits. The other 80% of each transaction’s base fee is now being burned. Note that transaction fees can be paid in any ERC-20 token approved by onchain governance, not just CELO. Fees paid in ERC-20s are converted to CELO in order to be burned but are transferred to the Green Fund as is."

Upgrades

• From Crypto Briefing (19-5-2021):

"Celo has launched its Donut hard fork, which includes the launch of several Celo Improvement Proposals (CIPs). These proposals include adding compatibility with Ethereum tools like MetaMask, cheaper encryption, improved Proof-of-Stake validator experience, and improved network security. The fork will create interoperable bridges between Celo and other blockchains such as Solana, Cosmos and NEAR. The update will also improve compatability with Ethereum.

There’s also CIP-20, which allows access to hash functions as a pre-compile on the Ethereum Virtual Machine. According to the team, CIP-20 will help towards implementing Plumo, Celo’s lightweight protocol for zero-knowledge proofs on mobile devices."

Staking

• From Messari (24-6-2021):

"The network will also feature an ongoing issuance in the form of epoch rewards (batch of block rewards). Epoch rewards will distribute the remaining 400 million CELO of the one billion max supply. At the end of each epoch, 75% (300 million total) of newly issued assets will go to network validators, while the Community Fund (24.5%) and a carbon offsetting fund (0.5%) receive smaller portions.

The protocol also offers incentives for running full nodes to service the light clients that run on each mobile device. In Celo, users can still earn inflation rewards in exchange for providing compute resources without having to stake funds."

Validator Stats

• Steady at 110 validators since Q4 2022 (26-1-2024).
• From their explorer (24-6-2021):

1. Elected/Registered Validators 100/141
2. Active Nodes 74/230

Scaling

• From a Nansen quarterly report (29-9-2022):

"Back in September 2021, Celo announced a partnership with Mysten Labs to improve the throughput of the Celo blockchain via an advanced mempool protocol, the Narwhal, and Tusk consensus."

Interoperability

• Is building bridges (10-2-2021).
• From Crypto Briefing (19-5-2021):

"Celo has launched its Donut hard fork, which includes the launch of several Celo Improvement Proposals (CIPs). These proposals include adding compatibility with Ethereum tools like MetaMask, cheaper encryption, improved Proof-of-Stake validator experience, and improved network security. The fork will create interoperable bridges between Celo and other blockchains such as Solana, Cosmos and NEAR. The update will also improve compatability with Ethereum."

Oracle Method

• From State of Stake (23-11-2021):

"Band Oracle services are now available on Celo."

• However, another announcement was made about a mainnet integration on 3-5-2022.

Their Other Projects

Valora

• From Decrypt (10-2-2021):

"A mobile phone-based remittance system. With the Valora app specifically, fees run as low as $0.01, according to Celo. It reports that the peer-to-peer payment app, which has been running in Beta since September 2020, has already been used by users in 100 countries to facilitate near-instantaneous transactions with the cUSD stablecoin.

It's like Venmo but totally permissionless and non-custodial. There's a big demand for that, especially when the fees are low, Celo's Marek Olszewski told Decrypt: "We're seeing that play out now with 28,000 people who, really in the last month, started signing up for Valora, and transacting with each other and, more importantly transacting with merchants, who now are increasingly accepting it places like Brazil and the Philippines.""

Roadmap

• Can be found [Insert link here].
• Celos’s mainnet launch is expected (6-5-2020) for mid-May:

"Kimble outlined five goals that Celo hopes to accomplish before the end of 2020, including the creation of a stablecoin ecosystem and decentralized finance protocols:

"A Universal Basic Income that is tied into a market creation system. Demurrage — institute a small charge for holding money. Natural-capital backed currencies — back money with things that you see. An ecology of money — local, regional, national currencies. Earn money into existence — an alternative to interest-bearing debt."

“The mission of prosperity for everyone will take a long time to achieve,” said Kimble. “By 2021, our hope is that we’re far along that path with people's basic needs fulfilled, growing along their unique path, and helping one another in meaningful ways.”

He also noted that Celo hopes to introduce “a Proof-of-Stake consensus algorithm, carbon offsetting with each block reward, bounties for regeneratives behavior, [and] and natural capital-backed currencies.”

Carbon offsetting will be achieved through initiatives like Celo’s "Project Wren" — with a portion of Celo’s block rewards being diverted to planting trees."

• Implemented EIP-1559 (1-2021).

Revenue

• Increased slightly since Q4 2022 from $17k towards $34.5k (26-1-2024).

Usage

• From Our Network (20-11-2020):

"Since the launch of the network on Earth Day, April 22 2020,  the number of addresses has grown to 30,000 and weekly active addresses to 13,000. The latter increased 500% since the beta launch of the Valora mobile wallet in early September and since then, the wallet has been used in over 46 countries."

• From Our Network (5-4-2021):

"The number of addresses grew 600% to 181,000 in Q1 2021. Part of the growth seems to be driven by impactMarket, a mobile-first Universal Basic Income dApp that gives $0.53/day to those in need. Today 13,000 beneficiaries across 64 communities are receiving cUSD, making it one of the largest UBI projects in the world. Data suggests beneficiaries are then staying in the Celo ecosystem because they can earn rewards and pay local merchants.

The number of transactions on Celo grew 300% from 6,800 to 31,600 in Q1 2021 totaling ~3.5m transactions over the past year, which is more than Polkadot and NEAR combined. The activity appears to be driven by 132 active developers building projects on Celo."

• From Our Network (8-10-2021):

"TVL on Celo has surpassed $865M, up 139% in Q3 2021. Around 74% of that TVL is in Mento, an AMM native to Celo which is responsible for helping cUSD maintain its peg to USD. Ubeswap (DEX) and Moola (Lending) are the second largest protocols by TVL on Celo with ~$81M and ~$79M in TVL, respectively. Celo’s TVL is likely to continue to see strong growth on the back of the announcement of a $100m DeFi incentive program and the launch of Optics, a cross-chain interoperability solution. The total number of Celo addresses has grown to over 1.3M, up 629% from 180,439 addresses at the end of Q1 2021."

Projects that use or built on it

• From Our Network (20-11-2020):

"Since mainnet launch, transactions have increased to over 1M, where over the months of September and October the primary use case was sending and accepting payments (~50/50 split). This was driven by the Grameen Foundation COVID-19 cash relief project in the Philippines during that period. More than 80% of the transactions over those months were via BeamAndGo, a Celo Alliance member that allows customers to pay for: food, medicine, supplies, mobile load, personal care, gadgets, gifts, and more at over 800 supermarket branches, 800 pharmacy branches, 2,000 gas stations, and 2,500 convenience stores in the Philippines."

• Mento (AMM DEX)
• Moola (Lending)
• Ubeswap (DEX)
• Uniswap V3 went live on it (14-7-2022).

Pros and Cons

Pros

• From Messari's year end report of 2020:

"Nailed the valuable “Libra minus Facebook” meme. Celo uses phone numbers as public keys (killer) and doesn’t require an internet connection, making it an attractive utility for the developing world. They’ve got a rockstar list of backers from Reid Hoffman to Jack Dorsey, and funds like a16z, USV, and Polychain, and Celo issuer cLabs acquired blockchain interoperability specialist Summa this summer to work on bridges with Keep/tBTC, Cosmos, Ethereum, and Polkadot. Like Terra, it may have been availability, not utility that held Celo back this year."

Competition

• From an interview with James with The Defiant (27-10-2020):

"Celo is targeting a kind of mobile-first customer base, so a lot of the work we do goes into building out the Android and iOS wallet called Valora, and so it's not trying to compete with Ethereum directly, it's trying to address a different set of users.

Celo is a very mission-driven organization and so we're primarily targeting users worldwide, rather than in the US. We're doing pilot programs in the Philippines and in Africa and other places around the world, trying to reach users who don't traditionally have access to financial services."

• From Decrypt (10-2-2021):

"Unlike Diem, it's got nothing to do with helping money flow through social media channels."

Team, Funding, Partners

Team

• Has cLabs and the Celo Foundation.
• Rene Reinsberg; CEO
• James Pestwich
• Marek Olszewski
• According to Messari (24-6-2021) it has Eran Tromer (founding scientist at Zcash), Elad Gil and Naval Ravikant as advisors.

Funding

• Pre-launch funding (7-5-2020) $36.5M
• From Cointelegraph (31-3-2020):

"Celo has awarded $700,000 in grants to 13 different companies who are looking to build on top of the network, contribute to the development of the Celo platform, or foster the Celo community.

The project has already received more than 50 grants proposals from teams based in 16 different countries and will continue to accept proposals until May 19."

• From Decrypt (10-2-2021):

"Announced it had raised $20 million from the sale of its native token, CELO (formerly Celo Gold), to venture firms including Andreessen Horowitz, Greenfield One, and Electric Capital."

• Summa (acquired by the operators of Celo in the summer of 2020).
• Messari names (24-6-2021): Naval Ravikant, Linda Xie, Reid Hoffman, Jack Dorsey and Elad Gil, Polychain Capital, Coinbase Ventures and Kilowatt Capital.

Partners

• Celo’s RWA ecosystem expanded through significant launches and integrations, including Untangled Finance, Huma Finance, Credit Collective, Centrifuge, and GENZERO in partnership with TIME (Q4 2022).
• Celo foundation is partnering (27-10-2020) with tBTC to bring tBTC on to the Celo platform. Which makes sense since James works with tBTC.
• PrimeDAO partnered with Celo to accelerate DAOs building at the nexus of web3 and climate (4-4-2022). Both projects intend to seal the deal with a tokenswap of $250,000 (23-5-2022).
• From a Nansen quarterly report (29-9-2022):

"Back in September 2021, Celo announced a partnership with Mysten Labs to improve the throughput of the Celo blockchain via an advanced mempool protocol, the Narwhal, and Tusk consensus."

Additionally, Mysten Labs would also provide support for the Move virtual machine to facilitate the migrations of frequently utilized Celo core contracts, such as cUSD and cEUR.

Lastly, to enhance self-custody efforts for users, Mysten Labs would also add the KELP key recovery protocol to Celo, allowing users to recover their private keys despite losing their mobile devices."

Bootcamp

• From Decrypt (21-4-2020):

"Celo is running an eight-week blockchain startup boot camp. 18 finalists have been selected, and each will receive guidance from mentors in PayPal, Winklevoss Capital, a16z and others. The winning startup will also receive a $10,000 cash prize."

Celo Alliance

• From Bitcoin.com (13-3-2020):

"The Celo Foundation announced 50 founding members of the Celo Alliance for Prosperity. Some members also support Facebook’s Libra project, such as cryptocurrency exchange Coinbase, Anchorage and venture capital company Andreessen Horowitz."

• From Cointelegraph (6-5-2020):

"The alliance's total membership has now tagged 75 just two months after launching."

• BisonTrails is partnered with Celo to provide staking node services (8-5-2020).
• Is mentioned as a partner on Ontology's website (2-11-2020).
• Ankr is a member (11-11-2020).

DeFi for the People

• From Decrypt (31-8-2021):

"Celo today announced $100 million in funding for grants, education, and token rewards from major Ethereum decentralized finance (DeFi) protocols as well as the formation of DeFi for the People, an initiative "on a mission to make DeFi accessible to the 6 billion smartphone users around the world."

The founding members of the initiative are Aave, Curve, Sushi, 0x, UMA, Valora, Ubeswap, and Moola Market. Additionally, Chainlink, The Graph, RabbitHole and Wrapped.com have signed on as "education and infrastructure partners."

Aave is promising $20 million in token incentives to those who access the protocol via Celo's mobile platform. Decentralized exchange Curve has lined up $14 million in incentives. And Sushi, best known for its Sushi Swap DEX is dangling $10 million in front of new traders who use Celo."