Maple Finance, an institutional capital marketplace for digital assets, has partnered Alameda Research with the fintech investment firm Alameda Research in order to launch Defi’s first syndicated loans. Alameda will make use of Maple Finance’s latest development to offer loans to accredited non US institutions through a DeFi lending pool with a single borrower.
Decentralized Syndicated Loans
Alameda will be the only borrower in the pool. This leverages its high profile to get better loan pricing. Ascendex, Abra and CoinShares are the lenders to this pool. The pool has received $25 million in funding at launch. A growth plan is to increase that amount by $1 billion per year. The loan was also funded by two other institutional investors, who have yet to be identified. However, all of them are AML/ KYC certified.
A syndicated loan, for the uninitiated is a loan that a single borrower receives from a group or lenders. These loans have a value of typically billions of USD and are spread across multiple institutions to reduce risk. The lenders are typically banks and the borrowers can be corporations or governments.
Maple Finance is a specialist in providing uncollateralized loans services for high-grade, high volume trades. This new product adds another piece to the infrastructure that companies need to borrow money and grow.
Sid Powell, Maple Finance CEO, stated that “what’s most important about it” is that it gives firms access to capital markets and institutional investors so they can raise their own debt. This is a completely new way of doing things. It could be viewed as an on-chain crypto SPAC [special use acquisition vehicle]”.
Powell stated that the new loans will have fixed interest rates in the range of 8-10%. The loan, unlike other crypto-lending services is undercollateralized and relies on Alameda’s reputation to repay it.
Alameda has invested both in and borrowed from the crypto industry to help build infrastructure. Alameda invested $3.9 Million last year in Defi software innovation company to address risk.
Alameda was established by FTX CEO Sam Bankman Fried in 2017. It has since acquired more than $36.7 billion USDT.
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