DeFi Pioneer MakerDAO Funds US Regulated Bank

In August, ManufacturerDAOthe organization behind the decentralized stablecoin Dai, provided $100 million in credit to Huntingdon Valley Bank (HVB)a Pennsylvania-based community bank, which it will use to provide new loans to local businesses in the Philadelphia area.

It’s a remarkable moment.

One of the leading decentralized autonomous organizations in the cryptocurrency world is now funding a publicly traded and regulated US bank, which is not allowed to hold cryptocurrencies on its own balance sheet, and in return it is getting yield and collateral protection of conventional loans – mortgages, commercial loans. loans to small and medium enterprises – all held in a master trust.

Crypto is doing something useful for once.

This is a move that traditional institutions now looking to gain exposure to crypto assets should take note of. Some of the crypto natives want to go the other way and gain exposure to conventional assets for their yield and security.

But a backlash from crypto purists now threatens to overwhelm this breakthrough.

Surprisingly, even after the crypto crash that followed the detachment of the UST stablecoin from Terra in May and the collapse of crypto lenders such as Celsius, investment banks and mainstream asset managers are still looking to profit from adoption. of cryptocurrency by traditional institutional investors.

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