• M11 Credit has resumed crypto lending on the decentralized credit marketplace Maple Finance.
• The new liquidity pool will offer lending only to selected clients with an expected annual yield of 10.75% in USD Coin (USDC).
• Liquidity pools managed by M11 Credit suffered $36 million of defaults following FTX bankruptcy.
M11 Credit Resumes Crypto Lending on Maple Finance
Blockchain-based financing firm M11 Credit has resumed crypto lending on the decentralized credit marketplace Maple Finance. The new lending pool will have an expected annual yield of 10.75% in the stablecoin USD coin (USDC) with a 60-day duration, the firm said. It will only be available to select “premier low-latency trading firms with market-neutral strategies that have a strong and established track record of borrowing from M11 Credit pools”, as per a blog post published by Maple Finance.
FTX Fallout & Risk Management Framework
Liquidity pools managed by M11 Credit suffered $36 million of defaults, while several loans saw missed payments and were restructured after FTX filed for bankruptcy in November last year. Orthogonal Trading, one of the largest borrowers on M11, was accused of misleading M11 and Maple Finance by misrepresenting how much it had lost in the FTX collapse, leading to losses of up to 80%. To address these issues, M11 has upgraded its underwriting and monitoring framework and appointed a new Head of Credit who is responsible for overseeing the lending business going forward.
The parameters for this new liquidity pool are as follows: single borrower exposure; expected net APY: 10.75%+ in USDC; duration: 60 days with liquidity on demand afterwards.
Enhanced Underwriting Process & Real-time Monitoring
The expanded Pool Delegate team has established an enhanced underwriting process and credit policy which includes real-time monitoring tools for both on and off-chain assets to ensure better risk management going forward.
M11 Credit’s resumption of crypto lending service on Maple Finance provides investors with an opportunity to earn returns while being assured that there is improved risk management in place due to upgraded underwriting and monitoring processes as well as appointment of a Head of Credit responsible for overseeing the lending business going forward.