Crypto exchange Kraken is working with decentralized lender Maple to build an onchain warehouse facility for its digital asset-backed loans.
The facility will help power Kraken's over-the-counter lending program used by institutional and wealthy crypto clients, where they can borrow USDC by posting their BTC, ETH, and other crypto as collateral.
Maple’s scalable "warehouse facility," essentially a revolving line of funding, is modeled on the asset-backed securities (ABS) used in traditional credit markets, including for auto loans and mortgages.
"The infrastructure that powers a multi-trillion-dollar ABS market in traditional finance has never existed onchain, until now,” Maple CEO Sidney Powell said. “This Facility applies that model to digital asset collateral in a fully onchain environment, with the structural protections institutions actually require."
According to the announcement, Maple will provide senior financing through a bankruptcy-remote special purpose vehicle (SPV), a special legal entity designed so that if something goes wrong with Maple or Kraken, the assets in the facility are protected.
