Place/Date: - November 7th, 2021 at 6:24 pm UTC · 4 min read
With crypto transactions in Europe surpassing $1T in the last 12 months, the stage is set for the launch of Credefi – a European Fintech / DeFi protocol connecting crypto lenders with small & medium enterprise (SME) borrowers from the fiat economy.
Credefi’s strong team of finance professionals with 40+ years’ experience in leading roles with commercial, investment and central banks, as well as private equity funds and assets management, aims to disrupt SME lending by enabling companies to tap into the fast-growing DeFi space.
This is a complex and tricky endeavor that very few projects have dared to tackle, but it has the potential to open a whole new segment in DeFi and more importantly – to take DeFi to the next level by actually connecting it with the real economy.
So far the DeFi space has been a universe of its own – lending and borrowing crypto assets between crypto investors. At the same time small and medium enterprises have been historically underserved by traditional banks and are borrowing at consistently high interest rates. They are not able to use funds locked in DeFi because the system is too complex and difficult to enter, with many “hops” to make, which scares businesses away. For example, standard DeFi borrowing requires crypto collateral that companies do not possess in the first place.
Credefi aims to change that.
Credefi is a pioneer in bridging those two worlds and enabling the flow of DeFi funds to the real economy. When Credefi’s vision gets realized, crypto investors will have a reliable source of yield on their stablecoins regardless of bull/bear market dynamics, while SMEs will enjoy quick, flexible and convenient borrowing and financial services.
Credefi’s platform enables decentralized and secured lending to portfolios of businesses, protecting lenders while providing them fixed APY that is uncorrelated with crypto markets’ volatility and won’t evaporate in a bear market. The platform will be rolled out in three stages: Portfolio Lending, Peer-to-Peer Lending and Trade Finance, thus covering the key financial needs of SMEs.
The team has already assembled an impressive list of partners and supporters of their vision. They are the first blockchain project partnering with Experian – one of the Big Three credit scoring agencies in the world, that will help validate and calibrate Credefi’s proprietary risk-assessment models. They also plan to bring as much off-chain data on-chain, partnering with Lithium Finance and SupraOracles to this end. Polygon also backed the project with a Polygon Development Grant, helping the integration with the Polygon chain to lower transaction costs for users.
Credefi has just concluded a $1.8M in private round led by Marshland Capital and Moonrock Capital, with key investors including also Varys Capital, X21 Digital, Magnus Capital, Skynet Trading, LucidBlue Ventures, Black Edge Capital, AU21 Capital, Peech Capital, Metrix Capital, Maven Capital, RR2 Capital; and angel investors like Heslin Kim.
The alpha version of the platform is now being tested internally, with public testnet planned to roll out in November. The platform will have a guarded launch with EU-only borrowers and will later expand to markets in East Asia, Latin America and the CIS region.
The project will do an IDO with CardStarter on November 8. Community members will be able to start staking immediately and convert their CREDI tokens into the xCREDI governance token that will have very limited supply.
Credefi aims to become a gateway to DeFi for SMEs and render obsolete the outdated, bureaucratic and overregulated banking services SMEs now have to cope with, replacing them with quick, flexible and user-friendly funding solutions. You can learn more about their platform, tokenomics and latest developments at the website, as well as Telegram and Twitter.