Web3 lending platform Maple Finance announced the launch of a direct lending program, according to a June 28 fact sheet from the platform’s development team. The program is intended to replace services previously provided by Celsius, BlockFi and other now-bankrupt lenders.
The first loan pool will be launched in July, the company said.
Introducing Maple Direct, the new lending division of Maple Finance.
With the launch of Maple Direct, Web3 now has a specialist digital native lender, launched to meet the growing institutional demand for a trusted direct lending desk in Web3.https://t.co/Q4jfnABk3R
— Maple (@maplefinance) June 28, 2023
Maple Finance is a blockchain institutional capital market. Web3 businesses use it to obtain loans to fund product launches or expansions. In the past, Maple relied on credit professionals known as “pool representatives” to fund these loans. For example, Celsius used Maple to create a Wrapped Ether (WETH) lending pool in February 2022.
But in the bear market in mid to late 2022, some of the largest Web3 lenders went bankrupt. Celsius closed its doors in July, BlockFi went bankrupt in November, and Genesis declared bankruptcy in January.
In a June 28 announcement, the Maple team said it will now fulfill the role of a lender on the platform in certain circumstances. It will use its credit underwriting expertise to make institutional allocator funds available to creditworthy borrowers. This means that if a potential borrower cannot get a loan from one of the other providers, that person can get a loan from Maple through its Maple Direct program.
related: Celsius Seeks to Convert Alternatives to Bitcoin and Ether Under Reorganization Plan
According to the Maple team, this new initiative is necessary because the major Web3 lenders have “exited the space” and traditional lenders such as banks “don’t have the necessary focus or expertise to provide innovation teams for Web3 technology companies.” provide coverage”.
The team said it will launch its first direct lending pool in July, focusing on lending to “infrastructure, asset management, and/or liquidity providers.” The team has invited capital allocators to earn yield through the program, which it says is suitable for “crypto funds, DAOs, venture capital, wealthy individuals, yield aggregators and/or family offices” seeking returns on investment.
Maple will also “continue to expand its existing services,” the announcement said, meaning Maple Direct won’t replace the current platform that includes competing lenders.
In November, Maple Finance’s lenders suffered losses from the bankruptcy of FTX and Alameda Research. Borrower Aurus Global missed a payment as a result of these events, and Maple severed ties with borrower Orthogonal Trading over alleged misrepresentations. But the platform bounced back quickly, launching version 2.0 of its software in December.