The State of Arizona has accepted Sweetbridge into its newly developed Financial Technology Sandbox. The Arizona Attorney General’s Office announced today that Sweetbridge is one of the first three projects to be accepted into the program.Scott Nelson, CEO and founder of Sweetbridge, said, “We are thrilled to participate in the first FinTech sandbox program in the United States, and are thankful to the State of Arizona, Attorney General Mark Brnovich, and Rep. Jeff Weninger for their leadership in bringing this program to the State of Arizona.At Sweetbridge, we are transforming how lending is done. We believe this to be the first regulatory approval for tokenization of titled assets for lending anywhere in the world, and we started in one of the most difficult regulatory environment, the United States. Through the visionary leadership in the State of Arizona, we will lower the cost of lending against all forms of assets, here and across the globe. There is a better way to offer people liquidity in their assets, and we can demonstrate that value through this Arizona pilot project.”The Arizona FinTech Sandbox is the first financial technology testing sandbox in the nation. It is modelled after the UK Financial Conduct Authority’s sandbox, and the concept was endorsed by the U.S. Treasury in its FinTech Report.An architect of the Arizona Sandbox, Paul Watkins, recently took a position leading the Bureau of Consumer Financial Protection’s Office of Innovation, and has signalled his intent to pursue a bureau or multi-agency federal sandbox. If this occurs it could allow Sweetbridge, and other similar companies, to expand tokenized projects into other states and additional offerings.Sweetbridge entered the Sandbox with a very particular use case for our protocols: token-based asset lending on vehicles. We plan to model tokenizing vehicle assets to a maximum of 10,000 Arizona residents over the next two years. Our goal in providing this token-based lending platform is to use technology, like blockchain, to create new efficiencies that lower the cost of capital for consumers taking out loans, while reducing risks in lending and lowering the cost to the borrower.Sweetbridge’s platform is based on blockchain technology, this technology offer the promise of changing financial services as much as the internet changed communication. Sweetbridge uses this technology to eliminate the need for any middlemen that add to the cost of lending today.At Sweetbridge, we have always had our sights on doing more with asset-backed, tokenized lending than just providing a lending platform for digital assets and currencies. Our goal has always been real-world solutions. As our team thought about the best use case for modelling real-world asset tokenization, we quickly landed on vehicles as a starting place. In the city of Phoenix, Arizona 91.6 percent of households have access to a vehicle, and the average household has access to 1.71 vehicles. For many families, a vehicle is the most valuable asset they own. This makes it the best place to turn for an asset-backed loan, rather than another credit card if they even qualify for a credit card.Research indicates that “more than 2 million people in the US, approximately 1 percent of American adults, use high-interest automobile title loans annually, borrowing against their cars.”But title lending is currently too expensive, and often unpopular with regulators because of predatory behaviors in the space. According to a 2015 report of the Pew Charitable Trust, data suggests, “similar access to title loans could be maintained at prices substantially lower than those in the market today. Neither the cost of capital nor the loss rate of the loans support the triple-digit APRs that dominate the industry, nor do they excuse what are too often customer-unfriendly and sometimes predatory loan terms. As the Arizona Attorney General’s office has noted, vehicle title lenders too often “have excessive and often disguised fees, inflated rates, and other terms that frequently result in consumers being unable to make their loan payments on time, resulting in default.”We believe there is a better way to offer people liquidity in their assets, and we can demonstrate that value through this Arizona pilot project.Sweetbridge has developed a blockchain-based loan product that can remove significant physical and operational overhead from the title lending process, and lower APRs from industry averages around 300% to around 20%. Through this pilot project, we can have a significant influence on improving an industry that desperately needs reform while demonstrating the transformative power of its platform.We, at Sweetbridge, are deep believers in the power of virtuously designed technology to transform business processes for the benefit of all. We are very excited that our first Arizona Sandbox acceptance contains the potential to offer a more cost-effective, customer-focused, and socially responsible vehicle-based lending. We are looking forward to developing this project while operating under the Arizona Sandbox over the next two years.Will Munsil, Sweetbridge’s Head of Legal Projects, said of the project, “We believe it’s possible for tokenized, asset-backed lending to lead to a lower-cost, more accessible kind of capital for many families in Arizona. We think this is a great time to live in Arizona, and we’re excited to bring our transformative economic models to Arizona citizens.”If you are an Arizona resident, we are currently recruiting for our Alpha test group for this pilot project. Contact our customer service department, [email protected], today to let them know you are interested.The first lending platform backed by tokenized titled assets in the United States. was originally published in Sweetbridge on Medium, where people are continuing the conversation by highlighting and responding to this story.