The crypto lending business model has come under intense scrutiny following a spate of recent credit events.
Credora is helping “rebuild confidence in credit markets through transparency, and the lending infrastructure provider announced a $6 million strategic funding round with S&P Global and Coinbase Ventures as major investors.”
The funding from the investment round will be used “to further build institutional rails for credit, and enhance Credora’s private computation technology that helps accurately underwrite and monitor borrowers.”
Information asymmetry has “been one of the root causes of recent credit events like Three Arrows Capital and Alameda, with borrowers unwilling to share sensitive information and lenders forced to rely on reputation and relationships when extending credit.”
The other major issue that plagued crypto credit markets was “the crumbling of centralized lenders.” Billions of dollars of client capital “were lost due to opaque principal lending models (Genesis, BlockFi, Celsius, Voyager).”
Darshan Vaidya, CEO of Credora commented:
“Credora solves the information asymmetry problem by using private computation techniques on real-time data, ensuring borrowers continuously validate their creditworthiness while maintaining the privacy of their sensitive information. Credora’s technology helps create more transparent and open lending markets built on robust underwriting standards.”
Founded in 2019, Credora reportedly “provides lending infrastructure and systematic credit ratings for private credit markets.”
It utilizes privacy-preserving technology “to improve lenders’ ability to properly evaluate credit risk in real-time.”
Credora has “facilitated over $1B in loans across various borrower types.”
This strategic funding round also “included participation from Spartan, Amber Group, CMT Digital, Hashkey, GSR, KuCoin Ventures, Paradigm.co, Pirata Capital, Breed VC, and WAGMI Ventures.”
With this announcement, Credora has “raised over $16m in venture funding to date from notable investors, including Coinshares, DCG, Gemini Frontier Fund, Polychain, Primitive Ventures, and XBTO.”
Darshan Vaidya, CEO of Credora, said:
“We’re delighted to have support for our mission to make credit markets more transparent and efficient, and will continue working with our partners to drive responsible data-driven lending. Adding S&P Global as an investor strengthens our belief that privacy-preserving technology can revolutionize credit underwriting and risk monitoring.”
Charles Mounts, Chief DeFi Officer, S&P Global Ratings commented:
“We are thrilled to engage in the credit DeFi ecosystem through our investment in Credora and believe the company is well positioned to be leaders in this space due to their innovative approach and utilization of technology.”