Untangled Finance, a real-world asset (RWA) DeFi protocol underpinned by institutional-grade assets, has launched its inaugural on-chain securitization pool on the Celo blockchain, bringing accessibility and security in the private credit space within DeFi ecosystems.
This milestone event signifies a paradigm shift, as Untangled Finance leverages Luxembourg’s robust securitization framework to introduce a pool structured for accredited investors, fortified by stringent KYC protocols. Underpinned by institutional-grade assets, the pool employs comprehensive asset ring-fencing measures to safeguard against the risk of originator bankruptcy, ensuring enhanced security for investors.
Collateralized by a diversified portfolio of French working capital assets from Karmen, a leading fintech lender specializing in instant loans for digital small and medium-sized enterprises (SMEs) in France, the securitization pool sets a debt ceiling of $6 million USDC. Verified investors gain access to a suite of pool-specific credit analytics and documentation, fostering transparency and informed decision-making.
The backing of The Credit Collective, a Celo community-led consortium, alongside Fasanara Capital as the senior lender, underscores the confidence in Untangled Finance’s innovative approach. This initiative, part of a broader €100 million senior facility agreement with Karmen, signifies a concerted effort to democratize access to high-quality private credit securities while bolstering capital accessibility for SMEs, the engines of economic growth.
Manrui Tang and Quan Le, Co-Founders of Untangled Finance, emphasized the platform’s mission to democratize access to investment opportunities traditionally reserved for large financial institutions. They underscored the role of stablecoins in fortifying the stability and reliability of private credit securities, enhancing their utility as a medium of exchange.
Since its inception in 2020, Untangled Finance has been at the forefront of leveraging blockchain technology to tokenize real-world collateral, facilitating global investor access to capital markets. This innovation streamlines financing avenues for SMEs worldwide, particularly those in emerging markets, fostering economic empowerment and growth.
Isha Varshney, Head of Ecosystem at the Celo Foundation, hailed Untangled Finance’s initiative as pioneering in tokenizing real-world assets, highlighting its potential to revolutionize access to funding and risk management for entrepreneurs globally.
Francesco Filia, CEO of Fasanara Capital, lauded the integration of fintech lending with the digital asset ecosystem, envisioning a significant expansion in the tokenized debt market and setting new benchmarks for decentralized finance.
Looking ahead, Untangled Finance plans to roll out additional securitization pools, including the Fasanara Diversified Fund and a senior note backed by Eastern European invoice finance assets. This expansion underscores the platform’s commitment to fostering operational synergies and advancing the convergence of traditional finance with DeFi technology.
Gabriel Thierry, Co-Founder & CEO of Karmen, emphasized the transformative impact of their collaboration with Untangled Finance, accelerating access to capital for fintech originators and facilitating the deployment of working capital loans for French SMBs.