What Is Celo?

CELO is a mobile-first layer 1 blockchain protocol that aims to facilitate a global payment infrastructure using cryptocurrency and blockchain technology. According to Celo, our society’s current financial system excludes 33% of the world’s adult population. In this article, we’ll go through what is CELO and its plan to improve access to financial products.

Celo is designed as a mobile blockchain that provides a suite of financial tools available to anyone with a smartphone. While computer access in emerging markets and developing countries is limited, Celo seeks to make financial frameworks and payment systems more accessible than ever before. 

The Celo blockchain is powered by an sustainable proof-of-stake consensus mechanism. This allows the Celo network to process energy efficient and affordable transactions for users. What’s interesting about Celo is that the network has developed stablecoin support for many fiat currencies. While most other blockchains are limited to stablecoins pegged to the US dollar, Celo has introduced cUSD, cEUR and cREAL. But what is CELO, the network’s native token, actually used for?

CELO is the utility token of the Celo blockchain and is used for paying gas fees and voting in matters of protocol governance. The Celo development team also designed the Celo EVM (Ethereum Virtual Machine). The Celo EVM makes it easy for developers to port over Ethereum-based dApps and deploy them on the Celo blockchain.

What Is Celo? Key Takeaways:

• Celo is a layer one blockchain seeking to simplify payments for mobile users around the world
• The Celo blockchain employs a proof-of-stake consensus model to process on-chain transactions
• Users and developers can interact with the Celo blockchain through the Celo EVM
• The Celo network supports stablecoins pegged to a range of fiat currencies like cEUR, cREAL and cUSD
• CELO is the utility and governance token of the Celo blockchain

How Does Celo Work?

With Celo, users can instantly send a variety of stablecoins like cUSD or cEUR directly to other users in the same way we send SMS messages today. Celo’s unique infrastructure links mobile numbers to public keys. This removes reliance on long, complicated crypto wallet addresses. Using Celo, people can send funds directly to a friend or family member’s mobile wallet, even if they don’t have a crypto wallet. This simplicity and ease of use is an excellent step towards mass adoption and is one of the things that people love about Celo.

Another creative feature that benefits Celo is that the blockchain’s transaction fees can be paid in CELO and in the network’s native stablecoins like cUSD and cEUR.

The Celo Reserve

The native stablecoins of the Celo blockchain are backed by The Celo Reserve. The Celo Reserve is a portfolio of cryptocurrencies including CELO, BTC and ETH that stabilizes and backs Celo stablecoins. It works by expanding and contracting the supply of stable assets to maintain their value pegged to their respective fiat currency.

The Celo network requires three different groups of contributors to ensure its effective and continued operation. These groups are responsible for different activities and utilities of the Celo Blockchain.

Light Clients

Celo Light Clients are users who have installed Celo Network applications, like the Celo Wallet, on their mobile devices.

Validator Nodes

Celo validator nodes are responsible for powering the blockchain proof-of-stake consensus mechanism. These validator nodes confirm network transactions and produce new blocks on the Celo blockchain.

Full Nodes

Celo Full Nodes are powerful computers that act as the link between validator nodes and light clients. Full Nodes receive requests from users of the Celo Mobile Wallet and transmit network transactions to Celo validator nodes.

How Can I Use CELO Tokens?

Now that we know how Celo works, let’s learn more about CELO’s utility. CELO is the native token of the Celo blockchain. It can be used to pay gas fees when executing transactions on the Celo network. CELO is also the governance token of the Celo blockchain. With CELO, investors and holders of the CELO token can cast votes on important governance proposals regarding the future development of the Celo project.

The Celo ecosystem is also a growing layer 1 blockchain network, complete with decentralized applications (dApps) and other protocols unique to the Celo blockchain. So what is CELO used for when using Celo dApps?

UbeSwap

Ubeswap is the largest decentralized exchange on the Celo blockchain. On Ubeswap, users can trade CELO for a range of tokens that can only be found on the Celo network. You can also create liquidity pairs using CELO and earn rewards through fees collected from traders.

Moola Market

Moola Market is the leading money market and lending platform on the Celo blockchain. With Moola Market, you can lend out your CELO tokens to earn interest on your holdings.

Celo History

Celo was founded back in 2017 by an elite team of thought leaders in the cryptocurrency industry. The Celo project was originally founded by Rene Reinsberg, Sep Kamvar, and Marek Olszewski. The founding members all shared a vision for building a mobile-first payment platform that would provide accessible payments to users across the globe.

The core Celo team is made up of experienced individuals with their work history stemming from a prestigious list of companies and education providers, including the Massachusetts Institute of Technology, Stanford University, Google, Visa, and The Federal Reserve Bank.

The Celo Foundation is a non-profit organization that manages funds and grants that continue to promote and develop the Celo ecosystem. Work on the Celo project began as far back as 2017, and underwent three years of development before finally launching the Celo Mainnet on April 22, 2020, to coincide with Earth Day.

CELO Tokenomics

The maximum total supply of the CELO, the utility token of the Celo blockchain, is 1 billion tokens. Of this maximum supply, around 450 million CELO tokens are currently in circulation. This equates to roughly 45% of the total supply.

While the maximum supply of CELO tokens is 1 billion, only 600 million tokens were sold in the initial token distribution. The remaining 400 million CELO tokens are reserved for validator rewards. The initial supply was sold in a lengthy series of private sales and auctions that began in June 2018. These 600 million CELO tokens were allocated to investors as sale participants as follows:

• Founders and Project - 45.%
• Investors - 20%
• Premined Rewards and Airdrops - 35.5%

The CELO vesting schedule features a slowly decreasing rate of emission over time. This was implemented to guarantee a long-term commitment from the Celo team to continue expanding and developing the Celo Ecosystem. As per data provided by Messari, the initial distribution of CELO tokens should be fully vested by April 2027.

How Is CELO Created?

The CELO tokenomics tell us that CELO has a maximum total supply that was fully minted at the genesis block of the Celo mainnet launch. From this, we can assume that there is currently no way of creating new CELO tokens and increasing the maximum supply.

After the initial token distribution is fully vested, the CELO emission schedule will employ a decaying inflation rate wherein epoch rewards reduce linearly over time. These ongoing rewards will be used to incentivize validators to secure the network and produce new blocks continually.

Celo vs The Competition

It’s worth noting that Celo isn’t the only blockchain-based project trying to provide a global-scale payment platform using cryptocurrency. Another key player competing in this niche of the cryptocurrency industry is Stellar and its native token XLM. 

Both Celo and Stellar are aiming to build a payment network that allows users to send payments anywhere in the world instantly with low transaction fees. However, there are still several differences that distinguish the two protocols. So what is Celo doing differently?

Firstly, Celo is focused on providing a mobile-first payment network. This makes it far more accessible to users all over the world. While Stellar requires a crypto wallet and basic blockchain knowledge, Celo facilitates payments using mobile phone numbers as private keys. This drastically simplifies the use and adoption of the Celo blockchain to send payments.

Another feature that gives Celo an edge is the flexibility around transaction fees. When using Stellar to send funds, XLM is required to execute the transaction. With Celo, users can pay transaction fees in either Celo, the native token of the network, or using supported stablecoins on the Celo network like cUSD, cEUR or cREAL. Again, this feature is intended to streamline the user experience and make Celo easy to use for people with no crypto experience.

Despite this, Stellar is the larger and more widely supported project. In terms of market capitalization at the time of writing, Stellar XLM is roughly 6x larger than Celo, with a market cap of $3 billion compared to Celo’s market cap of approximately $500 million.

Celo Investors

The Celo blockchain is attempting to disrupt and revolutionize the mobile payments industry. Celo aims to use cryptocurrency and blockchain to streamline a function that millions of people use daily, with the ultimate goal of having people use blockchain daily without even realizing it. Naturally, this goal aligned with institutional investors on a grand scale and attracted top-tier industry firms. As a result, Celo received early investment support from a wide range of funds, including:

• a16z Crypto
• Coinbase Ventures
• Dragonfly Capital
• Polychain Capital
• Electric Capital

The Celo project also caught the eye of prominent individuals like Jack Dorsey, the founder of Twitter. 

Celo Strengths, Weaknesses, Opportunities and Threats 

Strengths

The Celo blockchain’s greatest strength is its simplicity and ease of use. As it uses mobile phone numbers as private keys, Celo makes the onboarding process easier than ever. People can start using the Celo network even if they don’t have a crypto wallet yet. Being able to pay transaction fees in Celo stablecoins like cUSD also simplifies the process and makes Celo even more accessible to non-crypto users.

Weaknesses

For a layer one blockchain that is EVM compatible and capable of supporting smart contracts, Celo doesn’t offer a great range of dApps in decentralized finance. When compared to other EVM chains, the Celo blockchain has relatively low TVL and active DeFi usage statistics. However, it is worth mentioning that the primary function of Celo is its mobile-first payment network, not a burgeoning on-chain ecosystem.

Opportunities

For Celo to further develop and expand its product offering, the team needs to increase the number of available Celo stablecoins supported by the network. Expanding beyond cUSD is already a great start, but adding new currencies like cCAD, cINR and cYEN would vastly grow and diversify the Celo user base.

Threats

Mobile payments can present a security risk to Celo. Mobile users are prone to visit hundreds of sites every day while on the go, and could potentially be at risk of unknowingly connecting their mobile, and Celo balance, to malicious sites. Therefore, it is important that Celo continues providing educational material that helps users to be safe while using the product.

The Celo Roadmap 

The Celo roadmap is progressing as expected, with the team consistently meeting their development deadlines. The next stages indicate a focus on further developing the Celo blockchains NFT niche, with the release of an official Celo NFT Marketplace. For those asking ‘What is Celo working on?’ You can find out more by visiting the Celo Roadmap.

Celo Updates, News and Highlights

The Celo Network Deploys on Uniswap

Uniswap is one of the largest and most celebrated decentralized exchanges in the cryptocurrency industry. In July 2022, the Celo Foundation announced a collaboration with Uniswap Labs that would deploy the Celo blockchain on the Uniswap platform. This will help to bring DeFi user activity to the Celo blockchain and allow traders to take advantage of Celo’s fast transaction speed and low gas fees.

While users can only pay for transaction fees using the CELO token, for the time being, future development updates will permit the use of Celo stablecoins like cUSD to be used.

The Celo University Guild

Towards May 2022, the Celo foundation launched a new initiative called the Celo University Guild. The Celo University Guild aims to empower Universities and tertiary education institutions worldwide to expand their blockchain offering and host events that will raise awareness for the cryptocurrency industry.

These events will include conferences and hackathons that will introduce blockchain technology and utility to learners from all backgrounds. The Guild will also connect entrepreneurs and thought leaders with the variety of funds and grants within the Celo ecosystem that will grow and expand the range of products available on the network.

Celo: The Eco-Friendly Blockchain

Since the early days of the Celo foundation and the initial development of the Celo blockchain, being a sustainable and eco-friendly network has been a focus of paramount importance. While popular cryptocurrencies like Bitcoin and Ethereum often come under fire from the media due to their energy-intensive mechanics, this is not the case for Celo.

The Celo blockchain uses a proof-of-stake consensus model to secure the network and produce new blocks. This mechanism consumes far less energy than traditional proof-of-work chains and makes the Celo chain extremely sustainable. But Celo’s commitment to a sustainable future goes far beyond just an eco-friendly operating model.

In May 2021, the Celo Foundation proudly announced that the Celo blockchain was officially Carbon negative. The Celo Foundation has been actively offsetting its already minor carbon emissions through various initiatives that benefit the environment. In collaboration with Project Wren, Celo has offset over 2,219.5 tons of CO2. So what is Celo doing to reduce its ecological impact?

Loam

The Loam project was created to incentivize farmers to transition to and implement regenerative agricultural practices. Loam is built on the Celo blockchain and provides a global marketplace where farmers and ranchers can earn tokenized incentives through changes in their farming practices. The Loam team and project have ambitious goals, and forecasts that they need an adoption rate of just  5% from farmers around the world to sequester more than 1 billion tons of carbon per year. This equates to approximately 20% of annual emissions in the US alone.

Moss

Moss is a sustainability project built on the Celo blockchain that aims to preserve the Amazon Rainforest by tokenizing carbon credits. These credits can be earned through incentivized afforestation, reforestation, and preservation initiatives that protect and restore the Amazon. Moss’s mCO2 offers some unique utilities. It not only allows people to offset their carbon emissions but it can also be used in DeFi protocols on the Celo blockchain.

Where Can I Buy CELO?

Now that you’ve learned all about Celo, you might be interested in buying CELO tokens. With OKX, you buy CELO directly using your credit card. Then, simply head to our convenient ‘Buy Crypto’ page.

Follow the on-page instructions to complete your purchase. We support payments made using Visa, Mastercard and other selected payment methods like Apple Pay. 

Where Can I Store CELO?

Did you know your OKX account comes complete with your very own unique crypto wallet? With OKX wallet, you can safely store your CELO tokens within your OKX account. At OKX our wallets utilize bank-level SSL encryption to safeguard your investment. You can also further protect your assets with extra features like 2 Factor Authentication.

If you want maximum security, you can also store your CELO tokens using a reliable hardware wallet. Industry-leading hardware wallets like Ledger and Trezor provide unmatched security for your cryptocurrency and are a very popular choice for long-term investors.

Alternatively, you can store CELO in a compatible private wallet like Metamask. Please ensure you correctly input your unique wallet address because you risk losing your CELO tokens if you incorrectly provide your address.

How To Stake CELO

The best place to stake your CELO tokens is OKX Earn. OKX Earn is a complete staking platform available to all OKX accounts with attractive interest rates. To stake your CELO, visit the OKX Earn page and search for a CELO staking subscription using the search function provided.

After you’ve chosen a suitable subscription, simply click the ‘Subscribe’ button and deposit your CELO tokens to immediately begin staking your coins and earning passive income on your investment.

FAQs About Celo

What Is Special About Celo?

Celo is special because it’s a blockchain-based payment network designed for mobile users. With Celo, users can instantly send funds to friends and family using just their mobile phone number, kind of like how you would send a text message.

What Is the Difference Between Fixed and Flexible Staking Subscriptions?

In a fixed staking subscription, you agree to lock your tokens for a specific amount of time, usually with increased rewards. You cannot withdraw your tokens during a fixed subscription until the lock-up period is over. In a flexible staking subscription, there are no lock up times, and you can withdraw your tokens whenever you like. 

Can I Swap Other Cryptocurrencies for CELO?

You can easily swap other popular cryptocurrencies you hold for Celo instantly using our beginner-friendly ‘Convert’ feature. First, search for Celo using the ‘To’ box provided and input the amount of the crypto you’d like to swap for Celo in the ‘From’ box above. If you’re happy with the conversion rate, hit Convert, and your CELO will be deposited into your account.

Does OKX Charge Fees When Buying CELO?

OKX charges some of the lowest fees in the industry when trading and buying CELO. If you want to reduce your fees, you can unlock lower fee structures by hitting monthly trade volume targets or holding OKB.

How Much Money Do I Need To Start Investing in Celo?

With OKX, you can buy CELO regardless of the size of your wallet. The minimum order is of 1.1 CELO.