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Genesis, one of the largest credit and trading companies in the cryptocurrency market, is expanding its presence in decentralized finance by investing $75 million in Maple’s Solana-based lending platform.
Genesis’ contribution to Maple Solana will make it the first centralized trading firm to act as a pool delegate for its Solana-based platform. Maple launched its Solana platform earlier this year, and also launched a lending platform on Ethereum.
Trading firms Wintermute and Amber Group plan to borrow funds from a pool managed by GGC International Limited.
To be sure, $75 million represents a small fraction of Genesis’ total loan portfolio, which as of March 2022 exceeded $44 billion. Through its subsidiary Genesis Capital, the firm issues cryptocurrency loans worth tens of billions of dollars a month.
Nevertheless, the contribution to Maple reflects how large crypto firms are increasingly turning to decentralized financing , and in this case to the Solana network – to make transactions and issue funds. Genesis said that using part of their loan portfolio through the Maple infrastructure leads to lower operating costs by replacing traditional software tools with network capabilities.
Unlike Wall Street, the barriers to entry to participate in the Maple ecosystem are not as burdensome, allowing any “sophisticated” underwriter to form a pool. Borrowers on the platform undergo a due diligence procedure, which is monitored by representatives of the pool in order to reduce credit risks.
“We fully expect most of the major CeFi players in cryptocurrency to use Maple’s infrastructure to expand their online lending business over the next year,” Maple founder Sid Powell explained.
Despite the volatility of the cryptocurrency market, where the price of bitcoin has dropped by more than 30% this year, Maple claims that none of its borrowers have missed interest payments since its inception in May 2021.
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