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Today, significant industry participants, including Coinbase Ventures, revealed a strategic fundraising round for Centrifuge, the first DeFi protocol to finance real-world assets (RWAs) on the blockchain. https://twitter.com/centrifuge/status/1587828193066594306
Centrifuge $4 Million Funding Round
The $4 million Centrifuge funding round comes amid tremendous growth in recent months and a growing interest in real-world assets across the financial industry and the crypto space entirely. BlockTower Capital, a cryptocurrency and blockchain investment business, established a $3 million strategic relationship with Centrifuge earlier this year. The DeFi protocol has already funded more than $182 million in physical assets. In an interview, Centrifuge's CEO and co-founder Lucas Vogelsang stated that tokenizing highly liquid, well-established assets slightly increases usefulness. Due to its primarily illiquid and extremely untransparent nature, the firm has decided to concentrate on the private credit market.
BlockTower’s Support to Centrifuge
BlockTower's support goes beyond a conventional VC investment. As a source of collateral to MakerDAO, the BlockTower credit team has received the first clearance to join. BlockTower will provide $70 million in junior capital, joining Maker's $150 million commitment to establish a $220 million pool on the DeFi protocol. Businesses may tokenize non-crypto assets like mortgages, bills, and consumer credit to produce asset-backed pools using Centrifuge. Once on the network, these assets are released and may deal with investors effectively. Anyone can offer liquidity at this point. In the end, Centrifuge wants to establish a sustainable, decentralized credit ecosystem.
Centrifuge's Next Move
According to Vogelsang, there are two primary consumers of the Centrifuge. The investors who will hold these assets actively, and the issuers, a tiny group that performs the labor-intensive work of bringing the assets online. Investors now communicate with these assets using Centrifuge's Tinlake marketplace. He further stated that the issuers build these assets using the Centrifuge parachain on Polkadot and will connect them anywhere there is liquidity. The DeFi protocol will use XCM and Polkadot's unreliable Snowfork bridge to link to parachains.