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Author: Li Xiaoyin, Wall Street News
The new generation of digital asset institutions are reincreasing their risk exposure driven by soaring digital asset prices and launching new forms of cryptocurrency loan business.
Benefiting from the surge in Bitcoin prices and Trump’s support for digital assets, the cryptocurrency market has gradually recovered, returning to the billion-dollar level, and investors have returned to the market.
San Francisco lender Divine Research saidAbout 30,000 unsecured short-term loans have been issued since DecemberThe company founder Diego Estevez called this model “Enhanced Microfinance”.
Startups like 3Jane and Wildcat are also expanding their unsecured credit lines to attract venture capital injections.3Jane received a $5.2 million seed round from venture capital firm Paradigm in June and has now provided an unsecured USDC credit line on the Ethereum blockchain.
New lenders emerge, targeting unsecured microfinances
Diego Estevez said that Divine Research provides USDC stablecoin loans of less than $1,000 to overseas cash-strapped consumers.Interest rates are fixed between 20% and 30%, and use the iris scanning system of OpenAI founder Altman to ensure that default borrowers cannot reopen their accounts.
According to Estevez, Divine’s borrowers include ordinary people who are “not covered by traditional financial institutions” such as high school teachers and fruit vendors.The default rate for the first loan is about 40%, but the company “compensates these losses” with high interest rates while recovering only the free tokens issued to users “partially”.
According to media reports, Divine is piloting in Argentina with severe inflation, and most of the borrowers are new to cryptocurrencies, which reflects that crypto lenders are using blockchain transparency to expand to emerging markets.
3Jane asks the borrower to provideA “verifiable proof” of cryptocurrency, bank assets or future cash flows to support the loan, but no collateral is required.
Technological innovation promotes the accelerated implementation of credit products
3Jane is reportedly developing a new lending platform involving AI agents that can perform tasks based on user instructions.The company said the agents would be “procedurally obliged to comply with the debt terms” and therefore could lend “at lower interest rates.”
According to a March announcement by Coinbase, the exchange has partnered with Altman’s OpenAI to create an AI agent equipped with a crypto wallet to enhance business capabilities.Default loans to be sold to U.S. debt collection agencies, which aim to mitigate unsecured risk, but industry insiders say that although the permanent record of blockchain increases transparency, law enforcement challenges still limit its appeal.
Another protocol called Wildcat is designed for market makers and cryptocurrency trading companies, offering “highly customizable, fixed-rate, low-collateralized credit instruments” that the platform has lended about $170 million to date.
Evgeny Gaevoy, CEO of crypto market maker Wintermute and Wildcat consultant, said borrowers can specify interest rates, maturity dates and maximum loan capacity, and “in the event of a default, lenders will directly coordinate the pursuit of recourse.”
The lessons before you
Cryptocurrency lending suffered a heavy blow in 2022, when the price of digital assets fell, triggered a series of defaults and bankruptcies, which ultimately led to the collapse of the FTX exchange.
andCryptocurrency lending, backed by individual funds, is at the heart of the 2022 crash.
At that time, lenders such as Celsius and Genesis were unable to repay depositor funds and filed for bankruptcy, and Celsius CEO Alex Mashinsky was sentenced to 12 years in prison for fraud and market manipulation; Genesis agreed to pay $2 billion in settlement fees to resolve lawsuits by the New York State Attorney General accused him of cheating more than 230,000 investors.
Today, Bitcoin’s record highs and Trump’s support for digital assets have attracted a large amount of money to return.
Traditional institutions, including JPMorgan Chase, are also considering lending to customers’ crypto positions. Cantor Fitzgerald launches a $2 billion Bitcoin financing plan this month to provide leverage to coin holders.
at present,Unsecured loans still account for only a small part of the billion-dollar cryptocurrency lending market, dominated by institutions such as Coinbase, Tether and Galaxy.
