Celsius Dips Into DeFi , Delegating $30M in Ether on Maple Finance

Sebastian Sinclair
Sebastian Sinclair February 24, 2022
Updated 2022/02/24 at 4:12 PM
4 Min Read
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  • Celsius has tapped capital marketplace Maple Finance’s rails for the management and issuance of DeFi loans
  • Loans will be assessed based on a borrowers credit score, profitability and the strength of their balance sheet

Cryptocurrency lending platform Celsius is dipping its toes into decentralized finance (DeFi) by becoming the first centralized finance (CeFi) institution to deploy its services on capital marketplace Maple Finance.

By utilizing Maple’s DeFi infrastructure, Celsius will issue and manage undercollateralized loans as a delegate from a pool of $30 million in wrapped ether (WETH), according to a press release on Thursday. Wrapped tokens represent cryptos from other blockchains and are worth the same as the original. Pool delegates within Maple oversee lending pools and assess borrowers in exchange for a fee.

“The partnership came together naturally after we chatted in Q4, 2021,” Maple’s head of capital markets Daniel Kim told Blockworks who added an alignment existed between each company’s mission and area of expertise.

“It only took a few conversations to realize Celsius as a pool delegator was an idea worth exploring.”

Daniel Kim; Source: LinkedIn

Maple seeks to provide tooling and smart contract kits to businesses, such as Celsius, as well as access to turnkey solutions for loan origination, loan management and real-time performance reporting.

“This…shows the next growth in crypto where CeFi and DeFi platforms are working together,” Kim added. “It helps us achieve our goal to establish Maple as the dominant institutional capital network in crypto.”

Loans will be assessed on the basis of the borrower’s profitability, balance sheet strength and credit history. Celsius said it plans to scale the number of borrowers and loans issued in the coming year as it continues to fund “fast-growing” crypto institutions. Celsius joins BlockTower, Orthogonal Trading and Maven 11 as pool delegates.

The DeFi protocol claims its pool delegate model is “unique” by enabling businesses and credit funds to grab a hold of its rails to operate as lenders within the nascent DeFi sector.

“Maple’s lending infrastructure means we can move quickly and securely into this space,” said Celsius CEO Alex Mashinsky.

“Celsius will draw on its deep experience in underwriting and look forward to welcoming new borrowers this year and beyond.”

More than $670 million in crypto loans have originated on the protocol following its launch in May 2021, with over $650 million in total value locked, according to data by provider DeFi Llama. Maple Finance said it was aiming to hit a $5 billion loan volume target by year’s end by matching customer demand and exploring new markets.

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