TrueFi is about to introduce Bitcoin Prime to a larger and broader user base. The budding platform hopes to sell the unique advantages of decentralized finance to users across the globe.
TrustToken launched the new lending marketplace some months ago to offer asset managers a chance to establish their own DeFi tokens. The Stablecoin operator may have opened the doors to wider global adoption of DeFi services.
Ali Yahya, one of the general partners at Andreessen Horowitz, popularly known as A16z, said that the new lending platform would be offered on the TrueFi lending network. Independent financial institutions will have the option of designing, launching, and funding several investment products. The unsecured lending protocol gives asset managers access to information on the thousands of lenders and borrowers on the platform. TrustToken’s institutional offerings will also be offered to users.
A Marketplace for Lending
The initial version of TrueFi was launched in November 2020. TrustToken’s institutional clients were offered the protocol around the same period that the TRU token was launched.
In its first year, the protocol generated about $1 billion worth of loans for its users. The protocol was praised for giving providers the ability to offer collateral-free loans. All transactions are carried out in the True USD stablecoin denomination. The clients who receive these loans are usually assessed with the network’s on-chain credit scores.
The platform’s regular users have described it as an e-store for lending and borrowing. Unlike other DeFi platforms where developers are the only ones authorized to launch applications, TrueFi consents to have its asset managers launch unique financial applications directly on the platform.
TrueFi & Delt.ai Partnership
Earlier this month, TrueFi revealed its first official non-crypto financial partner, Delt.ai. The platform’s partnership with the Mexico-based Y-Combinator firm will be used to entice several Latin American businesses to join the train. Delt.ai has invested millions of dollars in loans to TrueFi clients. The team revealed that the goal is to loan businesses at least $25 million by the time the year runs out.
Jose de la Luz Lopez, CEO and co-founder of delt.ai said that their main interest is helping their clients secure enough funds to expand their businesses. He emphasized that the group is committed to sourcing loans for diverse companies in the TrueFi community without compromising the client’s potential returns.
Major lenders on TrueFi’s lending platform are private, pseudonymous individuals and corporations. These offices enjoy participating in DeFi investment opportunities without disclosing their real identities. In a statement directed at CoinTelegraph, TrustToken CEO Raphael Cosman, said that TrueFi’s borrowers and lenders come from diverse regions and cultures. He said they represent various startups backed by venture capital, crypto hedge funds, and even undisclosed conventional financial institutions.
TrueFi’s Driving Force
Cosman said that the driving force behind the rapid growth of DeFi products is their risk-adjusted yields. He explained that the growing global adoption of financial products on the blockchain network is because clients seek less risky yields, irrespective of whether they are backed by traditional finance or decentralized finance.
Right now, the centralized markets have very little to offer businesses. And they require large amounts of collateral to provide loans to businesses. Decentralized finance has the best yield the market has to offer at the moment. Clients and users are assured of lucrative returns once they get on-chain. DeFis are still a mile away from their peak, so one can expect that more traditional financial institutions will be jumping on board.
To many realists in the traditional financial ecosystem, the promise of higher yields is not enough to convince them. This is expected because crypto is relatively unfamiliar to hundreds of financial institutions, so that a transition would appear complex.
Cosman further explained that organizations need to fully grasp the knowledge behind cryptography before they can finally become comfortable with the brand. They have to learn about the risks, mechanisms for trading, the technology itself, and how to bring money into and away from crypto platforms.
In 2021, the blockchain industry will have advanced beyond expectations. Asset managers have bought and are still buying digital assets, while financial institutions are learning to utilize the fast speed of crypto transactions.
TrueFi is dedicated to providing more ways for existing financial infrastructures to tap into decentralized finance.
On the other hand, Delt.ai is very excited about Blockchain’s revolution in B2B loans in Latin America.