6 months ago
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Accredited investors gain new DeFi investment opportunities with enhanced security.
Real-world asset (RWA) protocol Untangled Finance has announced its first on-chain securitization pool on the Celo blockchain. The pool is structured under Luxembourg’s securitization laws, collateralized by a diverse set of French working capital assets from fintech Karmen, and has a debt ceiling set at $6 million.
The Credit Collective, supported by Fasanara Capital as the senior lender, has shown early support for this initiative, which is part of a larger €100 million senior facility agreement with Karmen. The pool offers access to credit analytics for verified investors who pass a comprehensive know-your-customer (KYC) process, ensuring asset protection against originator bankruptcy.
“Traditionally, private credit has been accessible primarily to large financial institutions due to complexities in asset vetting and liquidity issues. At Untangled, our goal is to democratize access to these investment opportunities for DeFi investors worldwide in a risk-adjusted manner, while enhancing capital access and making financing more accessible for the growth engines of economies—SMEs,” stated Manrui Tang and Quan Le, co-founders of Untangled Finance. “As stablecoins continue to gain traction, these high-quality private credit securities provide robust backing, significantly enhancing their stability and reliability as a medium of exchange.”
Untangled’s platform, which tokenizes real-world collateral like invoices and SME loans, has been operational since 2020 and has access to over 140 fintech lenders. Following the initial Karmen token pool, Untangled plans to launch additional pools, including the Fasanara Diversified Fund on-chain and a senior note backed by Eastern European invoice finance assets.
“The Untangled Finance team is pioneering private credit tokenization,” said Isha Varshney, Head of Ecosystem at the Celo Foundation. “By bringing fintech lending onchain with an innovative credit assessment models, Untangled showcases the potential of tokenized real-world assets to improve access to funding and risk management for entrepreneurs and businesses worldwide.”
RWA protocols usually aim for decentralized ecosystems with a significant amount of total value locked (TVL), such as Ethereum and Solana, as the RWA.xyz “Private Credit” dashboard shows. Despite its modest TVL of nearly $100 million, Tang explains that Celo was chosen for multiple reasons, including a mutual focus on RWAs as a key initiative and a shared vision for their future potential.
“Untangled is multichain and will soon deploy on other blockchain platforms, We chose to start our journey with Celo […] We believe that community funding from groups like the Credit Collective will encourage the continued proliferation of RWAs. Recently USDC and USDT were natively deployed on Celo, making it easy for investors to transact,” she adds.
Gabriel Thierry, co-founder & CEO of Karmen, highlights that this RWA effort bridges the decentralized and traditional finance sectors, enabling Karmen to accelerate its deployment of working capital loans for French SMBs.
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