In the exciting world of blockchain and cryptocurrency, a groundbreaking development has just taken place. London-based Untangled Finance has launched its tokenized real-world asset (RWA) platform on the Celo network. What’s even more exciting is the $13.5 million funding they’ve secured to bring private credit into the world of blockchain. Let’s untangle the details of this significant milestone.
About the Company
Untangled Finance is not your typical finance company. It’s a tokenized RWA marketplace that aims to bring traditional private credit into the blockchain realm. The company’s mission is to leverage blockchain technology to make the private credit market, which is currently worth over $1 trillion, more accessible and efficient. Their platform offers innovative solutions, such as blockchain-based credit pools, designed to serve a variety of investors, including certified investors, firms, and decentralized autonomous organizations (DAOs).
The Funding
Untangled Finance received a substantial boost in the form of a $13.5 million investment, led by Fasanara Capital, a London-based asset management firm. In addition to this funding, Fasanara Capital has also opened two credit pools on the platform, overseeing off-chain operations and loan underwriting. This investment demonstrates the growing interest in blockchain-based financial solutions and the potential of tokenized private credit markets.
Expansion Plans
Untangled Finance is not stopping at Celo. The company has ambitious plans to expand its reach to Ethereum (ETH) and the Polygon (MATIC) network using Chainlink’s Cross Chain Interoperability Protocol. This move will make Untangled Finance a multichain platform, ensuring interoperability and expanding its accessibility.
Tokenization of Private Credit Markets
The private credit market is a massive industry, but it has only dipped its toes into the decentralized finance (DeFi) space, with a total of $550 million in assets according to rwa.xyz data. Untangled Finance aims to change that by tokenizing private credit, bringing the traditional market onto the blockchain.
Untangled’s Focus
The platform’s founders, Manrui Tang and Quan Le, emphasize their focus on fintech lending, including services like invoice financing and consumer loans based on salary advances. Additionally, they are keen on promoting “green assets” like working capital or development loans for eco-friendly projects. This diversity of offerings caters to a broad range of financial needs.
Unique Features
Untangled Finance brings innovation to RWA lending protocols. The platform incorporates a liquidation engine that can auction off certain collateral assets to maintain the health of the credit pool. It also boasts a forward-looking credit assessment model that keeps an eye on borrowers’ future default risks. Furthermore, investors can take advantage of an auction-based withdrawal mechanism if they wish to exit the pools ahead of schedule.
Conclusion
Untangled Finance‘s foray into the world of blockchain and tokenized private credit marks an exciting milestone in the digital asset industry. With the backing of Fasanara Capital and ambitious expansion plans, the platform aims to become a key player in the evolving landscape of decentralized finance. As the market for tokenized assets continues to grow, it’s clear that Untangled Finance is poised to make a significant impact.
FAQs
1. What is tokenized private credit, and why is it important?
Tokenized private credit involves representing traditional financial assets like loans or bonds on a blockchain. It’s important because it can bring efficiency and accessibility to a trillion-dollar market, making it easier for investors and asset managers to participate.
2. How does Untangled Finance work?
Untangled Finance provides a platform for hosting blockchain-based credit pools. Certified investors, firms, and decentralized autonomous organizations can deposit funds, lend, and earn yields. They receive ERC-20 tokens to represent their positions, and the platform offers unique features like a liquidation engine and credit risk monitoring.
3. What is the potential for the tokenized asset market in the coming years?
According to Bernstein, the tokenized asset market could grow to a staggering $5 trillion within the next five years. This growth promises improved liquidity and accessibility for investors, making it an exciting space to watch.
