How to make sense of financing options on-chain?

Real World Assets Q&A
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In my time working on the protocol, I’ve found increasingly that the partnership between Centrifuge and MakerDAO has made for great headlines, generated demand, and proven out the promise of securitizing credit on-chain and financing that via MakerDAO.

This has led to many opportunities, proposals, and emails people seeking to both use the Centrifuge protocol for securitizing the offering – and then seeking financing on-chain for a senior lender.

This most often ends up on the Forum here – and inevitably through other private communication channels.

As I look to the future, I see the emergence of stablecoins such as AAVE’s GHO and the potential for Centrifuge to facilitate credit / allocations through yet another partnership with a major DeFi protocol.

However, it’s still opaque, difficult, and slow for any asset originator, debt issuer, or asset manager to self-direct their journey through the on-chain markets and engage with a potential investor, most often a senior lender, who is willing to review and understand their proposal for financing credit.

How can we the Centrifuge Community provide a simply roadmap or “how-to” for the current, an ever rising tide, of credit financing demand that comes to our door step?

There’s an opportunity for this community be a warm and welcoming place for those from traditional finance who are bold enough (in this market most especially) to try and finance credit in crypto.

I would propose that the community collaborate, and I’m happy to support those willing to lead with me, to better manage expectations of how investors can be approached on-chain and provide a simple roadmap for how to discover if the collateral and investment opportunity being proposed can be quickly evaluated.

To conclude, I think the question is simply this:

How can the Centrifuge Community empower potential issuers and asset managers to self-direct their own journey for discovering, engaging, and qualifying if their is investor demand for their offering?

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First of all, we did a great start with restructuring the Real World Assets-category in the forum to give potential issuers and service provides as well all interested parties an overview and a clearer structure in the forum:

Industry Insights & Analysis: functions as the place where broader industry discussions occur that impact the RWA movement and the Centrifuge protocol
Intros & Opportunities: it is specifically for partners to introduce themselves without requiring further formal details or intent to submit a proposal. This should be a place of open discussion between all potential investors, asset managers, and service providers as well community members to explore interest for specific opportunities
Pool Onboarding Proposals: This category is the next step where organizations can formally propose to bring credit on-chain through the protocol and finance assets through the Centrifuge protocol
Pools: used for all active pools that are launched and live on Centrifuge to present a summary of the Pool, it serves as well as a place for monthly and quarterly updates and gives the space for discussion around active Pools
Centrifuge Credit Group: The newly established Centrifuge Credit Group consists of credit experts with specialization in different asset classes with the goal to provide the Centrifuge community and partners with reviews of the aforementioned Pool Onboarding Proposals . Additionally, the CCG will support the community with all questions around the setup, assets, and risks of proposed new and existing pools. .
Pool Parties: The Pool Party category provides a platform for the people managing Pools atop the Centrifuge Protocol to tell their story, explain their business model, and share their vision of the future with an opportunity for the Centrifuge Community to dive deeper and build relationships with the organizations and the people that are financing RWAs

Further, I have the opinion we should use this Q&A subcategory to start to collect the most important questions and FAQs (similar to the user guides and manuals for the broader community) on RWAs to provide further assistance and guidance for everyone interested especially potential issuers and asset managers.

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Hey @ctcunning I wanted to chime in here.

I’ve had video calls with a couple potential issuers who both expressed the same sentiment:

Understanding the finance and crypto piece is hard.

Most people don’t have both backgrounds, and some knowledge gap exists.

What I have found though is everyone is eager to learn.

I think offering educational materials/resources/events could help empower both potential issuers and investors.

4 Likes
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Hi ItsJake
yeah, i agree that educational materials/resources will definitely help both!

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Great input @ItsJake! In your case, you talked to issuers so I assume it is mainly the finance to crypto transition, you are referring to when you mention the knowledge gap. Did those issuers mention specifically what areas of crypto they would like to understand better?

I certainly agree that many people are not familiar with both worlds (I am one of them myself) and filling that gap is essential to both get the community more engaged in the important decision making and also attract future issuers.

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The main feedback was there was a learning curve in filling out and understanding the POP Proposal and process. I am sure the v2 improves on it.

For someone non-crypto native I can see how the process can be confusing. There is some learning curve in understanding how to effectively use the forums, navigate Discord and find all the appropriate information/people.

1 Like