- Maple Finance tightens lending standards.
- Borrowers on the platform now need to file audited accounts with extra checks.
- CEO Powell said Maple Finance has suffered only one default till now.
DeFi platform Maple Finance has introduced stricter lending standards for borrowers on the platform with the aim to restrict any potential counterparty risk after observing the crypto industry being swept off by defaults in 2022.
According to the new requirements, borrowers will now have to sign legal agreements including annual submission of independently audited financial accounts, monthly reports summarising their financial wellbeing, as well as, balance sheet details, stated CEO Sid Powell.
In addition, borrowers will also need to sign up to credit risk data platform Credora, which enables real-time information for lenders, helping them determine levels of risk a borrower has piled across various cryptocurrency exchanges.
Maple Finance connects industry leaders and borrowers and the bear market and crypto price crash have reflected on the platform. The DeFi app’s value dipped to a low of $22.5 million from $153 million in June 2022.
Moreover, Three Arrows Capital’s collapse followed by digital-assist lender Celsius Network’s downfall drove Maple Finance to introduce these new tight guidelines.
CEO Powell further added, “This type of view would have been powerful for the centralized lenders who had exposures to 3AC. But the increased reporting requirements enhance the ability to monitor borrower health in a volatile market.”
Moreover, he also shared that to date Maple Finance has locked a single $10 million default out of a whopping $1.8 billion generated on the platform. Powell further cleared that Maple didn’t facilitate any loans to Three Arrows Capital.
Currently, Maple Finance has acquired a rich list of clients including Genesis Trading, Alameda Research and Wintermute.
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