In the cryptocurrency world, a significant step has been taken. Centrifuge, a startup specializing in blockchain-based tokenized real-world assets (RWA), has teamed up with Coinbase and Morpho to create a new credit market. This market aims to provide instant liquidity to institutional investors through tokens backed by U.S. Treasury bonds.
The Power of Tokenized Assets Unleashed
The innovative credit market will operate on Coinbase’s Ethereum-based Base network. Tokenized Treasury bonds, such as Centrifuge’s Anemoy Liquid Treasury Fund (LTF) and Hashnote’s U.S. Yield Coin (USYC), will be used as collateral in this market. The system established by Morpho will offer investors a secure borrowing environment.
Centrifuge implemented the idea of tokenizing real assets on the blockchain in 2017. However, at that time, these assets faced liquidity issues. In recent years, assets like short-term Treasury bonds have enabled the credit market to thrive. Lucas Vogelsang, one of the founders of Centrifuge, stated that this market aims to provide more benefits to tokenized assets in collaboration with Morpho.
According to Vogelsang, if you own a Treasury bond and need liquidity for a few hours or days, you can access instant liquidity in this market without going through a lengthy and costly process to reclaim your tokenized asset.
A New Era May Begin
The collaboration between Centrifuge, Coinbase, and Morpho also introduces the use of Coinbase Verifications in the permissioned lending market for the first time. The innovation makes the process more secure by allowing Coinbase customers to verify their KYC (know your customer) information through the Ethereum Attestation Standard.
The partnership accelerates the digitalization of traditional financial instruments by popularizing the use of tokenized assets in the financial world. Investors will now have the chance to create a more flexible and efficient financial structure by accessing instant liquidity through blockchain. This new credit market, managed by Morpho Vaults, Steakhouse Financial, and Re7 Labs, stands out as a harbinger of significant transformation in the financial world.
