Crypto Lender becomes first loan shop to expand on Solana

Crypto Lender becomes first loan shop to expand on Solana

Crypto capital marketplace Maple Finance said it is the first undercollateralized lending protocol to expand the Solana blockchain.

Maple's product is aimed primarily at institutional lenders, including individuals, aiming to allocate otherwise "idle" capital into a "diversified" liquidity pool, according to a statement on Monday. The protocol also said it has become the only multichain capital markets solution in the industry.

Following its recent rapid expansion onto the Ethereum blockchain, Maple hoped to address some of the “massive funding needs” of the Solana ecosystem. Rising Ethergas fees (power grid transaction fees) as well as Solana's large number of large investors have helped drive Maple's expansion to look for alternatives, it said.

“Solana has a vibrant ecosystem of decentralized autonomous organizations, non-fungible token projects, and whales holding significant Solana USDC (USDC-SPL),”Barry Quinn,Head of Maple Solanasaid Blockworks. “By bringing Maple to Solana, we enable these projects to earn a high risk-adjusted return on their native USDC SPL without having to use bridges or centralized exchanges.”

Coinciding with the launch is the first pool delegate to join Solana, a platform that uses confidential computer and cryptographic evidence to privately monitor borrowers' real-time risk, known as X-edge. The delegate is expected to manage an initial pool of $45 million denominated in Circle's USDC stablecoin on Solana, open to deposits of $5 million.

Pool delegates in decentralized finance (DeFi) act as gatekeepers for lending, including vetting new borrowers and managing the balance of a given pool.

The capital diverted into a pool will be syndicated and issued as loans to Solana-based corporate borrowers, which so far include FTX parent Alameda Research, crypto trading firm Nibbio and investment firm Nascent, which will use the funding to scale their operations.

Maple acquired decentralized finance lending protocol Avari in January to accelerate the launch of Solana, while also assembling a team of Stanford engineers including Quinn Barry and Jeffrey Hu.

“Maple has proven to be a critical infrastructure provider not only for blockchain companies, but also for increasingly traditional institutions entering the space,” said Sidney Powell, CEO of Maple. “Building the first multi-chain capital markets solution will in turn attract higher quality lenders and borrowers.”

Powell told Blockworks last month that Maple is targeting $5 billion in loans by the end of the year.

About $3 billion is expected to come from Maple's existing business, while $1 billion would come from Maple's Solana offering. The remaining projected $1 billion is expected to come from institutions that provide loans to miners.

When asked if Maple has plans to expand to other chains, Barry said his team is focused on bringing its product to both Solana and Ethereum.

“We view Maple as an off-chain offering and wanted to ride wherever the puck goes by bringing Maple into the rapidly growing Solana ecosystem,” Barry said. “However, we are continually evaluating new opportunities and have long-term plans to continue horizontal cross-chain expansion.”

Ben Strack contributed reporting.

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The post Crypto Lender Becomes First Loan Shop to Expand on Solana is not financial advice.