Untangled Finance Launches USDC Private Credit Pool on Celo Blockchain

The Untangled Finance protocol, specializing in real-world assets (RWA), has launched its first securitized credit pool on the Celo blockchain, marking a significant step forward for the integration of traditional finance with blockchain technology. This pool is aligned with Luxembourg securitization regulations and is secured by a diversity of French working capital assets belonging to fintech Karmen, with a debt limit set at US$6 million.

This new initiative has received initial support from Credit Collective, with the backing of Fasanara Capital as senior lender, within a comprehensive agreement involving a €100 million line of credit for Karmen. The pool enables credit analysis for verified investors through a rigorous know-your-customer (KYC) process, ensuring the protection of assets against possible insolvency of the originator.

Manrui Tang and Quan Le, co-founders of Untangled Finance, shared their view: “Traditionally, private credit has been primarily accessible to large financial institutions due to complexities in asset verification and liquidity issues. At Untangled, our goal is to democratize access to these investment opportunities for DeFi investors around the world in a risk-adjusted way, while improving access to capital and making financing more accessible for the growth engines of economies. – SMEs.”

Today, RWA protocol @UntangledFin launched on Celo! 🎉

The pool brings private credit to the DeFi ecosystem w/ enhanced security 💪

🧵 Keep reading to learn more about Untangled Finance’s novel approach to real-world asset tokenization ↓ pic.twitter.com/nMgsshfUP2

— Celo 🦇 🌳 (@Celo) May 2, 2024

Untangled’s platform, which tokenizes real-world collateral such as invoices and SME loans, has been operational since 2020 and collaborates with more than 140 fintech lenders. Following the launch of the initial Karmen token pool, Untangled plans to expand its offering with the introduction of the on-chain Fasanara Diversified Fund and a senior note backed by Eastern European invoice financial assets.

Isha Varshney, Head of Ecosystem at Celo Foundation, highlighted Untangled’s pioneering role: “By bringing on-chain fintech lending with innovative credit assessment models, Untangled showcases the potential of real-world tokenized assets to improve access to finance and risk management for entrepreneurs and companies around the world.”

RWA protocols like Untangled are essential for decentralized ecosystems with large volumes of value locked (TVL) like Ethereum and Solana. Despite Celo’s modest TVL of nearly $100 million, Tang highlighted the choice of this blockchain for its strategic alliance in RWAs and the shared vision of its future potential.

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