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Cadence Launches Blockchain-Based Tokenized Debt Marketplace

Cadence, a Coinbase-backed alternative investment provider, launched a blockchain-based investment platform for debt.

Cadence, an American blockchain-based alternative investment provider, has launched an investment platform for debt, according to a press release on July 10.

By launching its private credit investment platform, Cadence aims to bring more transparency and efficiency to the asset class in order to help companies grow their businesses. Cadence turns commercial debt into digital tokens that can be traded on its platform.

Private credit, or private debt, is a type of alternative investment which has only been accepted as a separate asset class very recently. Private debt investments are not backed by banks and are not issued or traded in an open market, and are used to fund business growth and provide working capital. Citing data from the Alternative Investment Management Association, the press release notes that total global assets in private credit are expected to reach above $1 trillion.

Cadence’s founder and CEO, Nelson Chu explained that the securitization market for private credit has been in “desperate need of innovation.”

The company, which has been recently listed on the Bloomberg Terminal, intends to contribute to the growing asset class by offering its digital securitization technology to expand private debt investments for institutional and accredited investors.

Securitization is the process of establishing a financial instrument that merged from various financial assets into one group. 

According to the press release, Cadence is backed by major United States crypto exchange and wallet service Coinbase, having raised $2 million in a funding round co-led by the exchange’s investment arm Coinbase Ventures earlier this year.

Recently, Luxembourg-based securitization firm Argento teamed up with London Block Exchange (LBX) to issue a bitcoin (BTC)-based bond.

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General Motors Leads $23M Funding Round for Spring Labs Blockchain Firm

Blockchain startup Spring Labs recently raised $23 million in Seed A funding round, says funds will go towards security products built on its Spring Protocol blockchain platform.

United States-based blockchain startup Spring Labs has raised $23 million in a Seed A funding round, according to a press release on June 12.

Spring Labs will purportedly use the funds to improve its blockchain-based platform Spring Protocol and develop three new fraud protection products that are designed to combat fraud in the auto financing sector.

According to the press release, the new products are Spring Verify, Spring Defense, and Spring Protect, which are designed for identity verification, fraud monitoring/mitigation, and loan stacking prevention, respectively.

The products will purportedly provide information to lenders anonymously, for the purpose of financing activities such as unsecured consumer lending, small business lending, credit card issuance, and secured auto lending.

According to the report, auto financing fraud has nearly quintupled from 2011 to 2018, purportedly becoming a relatively easier way to commit fraud as other credit options become more secure than auto lending options.

The report estimates that industry losses range between $4–$6 billion each year, largely due to auto credit established with fake ID credentials. Somewhat like a clone firm scam, Spring Labs says that scammers will typically mix in some real information along with the fake, in order to establish falsified credit accounts.

Among the investors for this seed A funding round were Galaxy Digital, the cryptocurrency investment bank founded by crypto enthusiast Michael Novogratz, and automotive giant General Motors (GM).

As previously reported by Cointelegraph, GM announced that it was joining the Spring Founding Industry Partners (SPIF) Program in February. The SPIF is reportedly a project launched by Spring Labs which aims to provide security solutions through research and collaboration.

Chief strategy officer at GM Mike Kanarios commented on GM’s decision to join the project as a partner, saying:

“As the captive finance arm for General Motors and one of the world’s largest auto finance providers, we are continually innovating and evolving our fraud prevention and detection capabilities to better serve and protect our customers and dealers.”

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How MakerDAO Works – The Stablecoin Explainer

The most popular decentralized finance application on ethereum, MakerDAO, was built to keep a stablecoin’s price stable. Under the hood, it’s quite complex, featuring two separate tokens, a lending system and even a voting process. Here’s how it works

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Crypto Lending Startup BlockFi Launches Gemini Dollar Accounts

Cryptocurrency asset management company BlockFi announced that it has opened interest-bearing accounts for the gemini dollar.

Cryptocurrency asset management company BlockFi announced that its interest-bearing accounts now support the gemini dollar (GUSD) in a post published on May 29.

Per the announcement, GUSD deposits will see a yearly yield of 6.2%, paid in the stablecoin in question. BlockFi notes that it also offers GUSD as a U.S. dollar funding option and as collateral from institutional cryptocurrency borrowers. BlockFi CEO Zac Prince commented:

“The implication of adding this functionality is that you could see crypto companies like BlockFi compete with traditional fintech challenger banks by taking advantage of assets like Bitcoin for on-ramps in to a dollar-based blockchain financial ecosystem.”

BlockFi notes that the accounts will not be available to United States-based customers due to a lack of regulatory clarity surrounding stablecoins backed by fiat currency. The firm states that it is working with legal counsel to add support for U.S. clients later this year.

Some in the cryptocurrency industry have criticized BlockFi, as its terms and conditions allow it to determine the interest rate each month at its sole discretion. David Silver of Silver Miller Law firm said the firm does not advertise what it guarantees, which could be confusing for users.

In March, BlockFi decreased the interest rates for its top tier bitcoin and ether accounts. In May, the lending platform further lowered interest rates for some of tis ether accounts as the lending environment for ether had purportedly floundered.  

Earlier this month, Korea’s oldest bank, Shinhan Bank, launched a blockchain-enabled lending platform to speed up the loan process.

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Korea’s Oldest Bank Launches National Blockchain-Based Loan Platform

Shinhan Bank introduced its blockchain-powered lending platform, allowing clients to get loans without face-to-face interaction.

Korea’s oldest bank, Shinhan Bank, has launched a blockchain-enabled lending platform to speed up the loan process, South Korean news agency Yonhap reports on May 27.

Shinhan Bank’s blockchain-powered loan system intends to boost cost and time efficiencies in the lending process, reportedly enabling the public to apply for loans online and get their credits without face-to-face interaction.

According to the report, the new system is the first initiative of its kind introduced in South Korea.

Specifically, Shinhan Bank’s new lending system applies blockchain technology in the verification and confirmation processes within the network of affiliated institutions and banks. The system allows the parties to register and operate in the network using an encrypted one-time password, enabling easy and instant access to the data necessary for the approval and issuance of loans.

A Shinhan Bank official reportedly said that the recent application of blockchain technology is a part of the institution’s attempts to provide remote services for clients. He added that the bank will continue to develop innovations with remote access as well as products to expand accessibility.

As the second-largest commercial bank in South Korea, Shinhan Bank has been actively embracing blockchain technology over the last year. In late 2019, the bank was reported to be implementing blockchain in internal processes in order to reduce the risks of human error. Previously, the bank also reportedly implemented interest rate swap transactions based on blockchain.

Recently, a group of four banks have successfully issued a blockchain-based type of a legally binding loan agreement called a promissory note. The system reportedly reduced the steps necessary for issuance the note by over 50%.

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Crypto Platform Says It Launches Two Products to Challenge Banks and Empower Customers

A crypto platform is unveiling features that enable users to borrow against their assets to unlock spending power.

A “next-generation” mobile payment platform has unveiled two products that are designed to help users smartly manage money matters and enjoy “greater financial empowerment.”

Crypto.com’s first new offering, Crypto Earn, gives the public “the freedom to grow their assets.” Available through the platform’s flagship app, the service allows users to deposit virtual currencies and accrue incentives, the company said. Consumers can choose to hold their assets for either one month or three months, and the company said a flexible plan will follow in the future.

The Hong Kong-headquartered company, which was founded in 2016, has also launched a second product called Crypto Credit. This service is designed to help users unlock spending power and monetize crypto assets without selling them — potentially helping borrowers to ride out price volatility in the marketplace.

Once a loan is taken out, borrowers are allowed to set their own repayment terms within a 12-month period, as well as avoid monthly late fees and deadlines. No credit checks are required for consumers to use this service, and the website says that it offers a loan-to-value ratio of 40% on bitcoin.

Loans are paid out in stablecoins, and the funds can be loaded onto Crypto.com’s MCO Visa Card to spend on everyday goods and services.

Crypto.com is available here

Kris Marszalek, the company’s co-founder and CEO, said: “MCO Visa Card, Crypto Earn, and Crypto Credit together form a powerful product suite that nobody else in the industry has today. We’ve never been more excited about the potential of our platform and look forward to continue scaling it globally later this year.”

Crypto Earn and Crypto Credit are available to users who have already been approved to use the Crypto.com Wallet and Card app — with the exception of residents in Singapore, Switzerland, Malta, the United States and Hong Kong. The company said efforts are underway to make the services available in these areas.

Collectively, the company said it is offering a modern approach to financial services — offering a crypto-focused alternative to banks that lend and accept deposits.

Positive feedback

As previously reported by Cointelegraph, Crypto.com’s MCO Visa Card offers cashback benefits that are meant to appeal to modern consumers and frequent flyers. Depending on the tier of subscription they choose for the card, consumers have the potential to benefit from free Netflix and Spotify subscriptions as well as cashback on all purchases, and additional rebates whenever bookings are made on the likes of Expedia and Airbnb.

When the new cashback features were unveiled back in March, Crypto.com’s CEO said the company had received “hugely positive feedback” from customers in Singapore, with the platform setting its sights on shipping its cards to customers in Europe, the U.S. and other markets.

Earlier in May, Crypto.com announced that it had officially received an ISO/IEC 27001:2013 certification following “rigorous third-party security audits.” The platform claimed it is “the first cryptocurrency wallet application to achieve this coveted accreditation,” and its chief information security officer claimed in a blog post that “the certification demonstrates that cybersecurity and privacy are embedded into Crypto.com’s DNA.”

Meanwhile, new coins and tokens have been added to the Crypto.com Wallet and Card app as the company strives to welcome users from across the community. Recent introductions include Enjin’s ENJ Coin — commonly used by gamers — along with the Basic Attention Token, an addition that is set to benefit an estimated 6 million people who actively use the Brave browser.

Learn more about Crypto.com

Disclaimer. Cointelegraph does not endorse any content or product on this page. While we aim at providing you all important information that we could obtain, readers should do their own research before taking any actions related to the company and carry full responsibility for their decisions, nor this article can be considered as an investment advice.

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Malaysia’s Stock Exchange to Develop Blockchain PoC for Security Borrowing and Lending

Kuala Lumpur stock exchange Bursa Malaysia is working on a blockchain-enabled security borrowing and lending proof-of-concept.

Kuala Lumpur-based Bursa Malaysia, the country’s stock exchange, is working on a blockchain-enabled security borrowing and lending proof-of-concept (PoC). English-language local media Bernama reported on the developments on May 6.

Per the report, the initiative aims to develop greater transparency and address other challenges of borrowing and lending securities in Malaysia.

More precisely, the exchange’s CEO, Datuk Muhamad Umar Swift, reportedly said that the PoC should increase the efficiency, speed and capacity of the aforementioned services, which should consequently bring greater demand. Swift claims that the benefits of the PoC will not be limited to the customers of Bursa Malaysia:

“The collaboration also benefits the wider industry through new knowledge, insights and practical experience in harnessing digital innovation to support and drive the growth of the capital market.”

The news outlet claims that this is the first such initiative taking place in an Association of Southeast Asian Nations member state.

Lastly, the report specifies that the PoC has been developed in partnership with Hong Kong-based Forms Syntron Information, the stock exchange’s technology partner. The project will reportedly involve Affin Hwang Investment Bank Bhd, CIMB Investment Bank Bhd, Citibank Bhd, Retirement Fund Incorporated and Malacca Securities.

As Cointelegraph reported last week, the CEO of the London Stock Exchange, one of the world’s oldest stock exchanges, believes that blockchain could have a use in issuing securities and settlement.

In March, news broke that major Spanish stock market operator Bolsas y Mercados Españoles has completed its first blockchain pilot for electronic certificates of collateral pledges.