0xCollateral was developed during ETH Global Prague 2025, an international hackathon gathering over thousand cracked web3 people, with the idea to make credit card pre authorization usable as collateral on chain to bridge the gap between traditional credit power and DeFi.

The project ended up winning both ETH Global and vLayer prizes bringing us to the main stage and earning the team a bit under $10k.

🔧 How it works

0xCollateral lets users lock a credit card pre-authorization as collateral to borrow crypto assets on-chain—no crypto collateral needed. The system uses vLayer’s web proof technology to cryptographically verify a Stripe pre-authorization, then feeds that proof into a reduced version of AAVE v1. The smart contract validates the proof and unlocks a borrowing position backed by the user’s traditional credit, all without KYC or identity checks.

💡 Context and motivations

Since the advent of DeFi, one core problem has remained unsolved: there’s been no way to take out a true Web3 loan. To borrow Web3 assets, users have always had to lock up their own crypto—often overcollateralizing their positions.

We wanted to find a way to leverage Web2 creditworthiness to enable Web3-native loans—without KYC, without identity checks, and with a fully permissionless experience.

🧠 Key learnings

Actually building a working POC of a project idea we had over a lunch break conversation in one day and a half day with unknown technology was definitely an amazing feeling.

As finalist, having the opportunity to present our work on the main stage, in front of hundreds of some of the best engineers in the space, was also an interesting communication and pressure management exercise.