DeFi Protocol Clearpool selects Polygon Networks for its institutional lending platform
Join the most important conversation in crypto and web3! Secure your place today
Decentralized finance (DeFi) protocol Clearpool will deploy its institutional credit platform Prime exclusively on the Ethereum scaling tool Polygon network, the protocol told CoinDesk in a statement.
“We have been working closely with the Polygon team since we launched the permissionless protocol on Polygon in June,” said Rob Alcorn, CEO and co-founder of Clearpool, in an email. “We have a strong relationship and continue to work together to deliver institutional DeFi products.”
Clearpool Prime will act as an institutional-grade capital marketplace, where borrowers can create credit pools and liquidity providers can invest to achieve returns. The platform is set to begin operating in the first quarter of this year, CoinDesk previously reported.
“Expect to see a wide range of borrower profiles: from traditional trading firms to various types of crypto-native players,” Jakob Kronbichler, Clearpool’s co-founder and chief operating officer, said in a statement. “Prime is also attractive to fintechs that offer lending solutions in the world of TradFi (traditional finance), such as loans in emerging markets.”
On Monday, the protocol also opened the onboarding and whitelisting process for institutional borrowers and lenders, who must pass know-your-customer (KYC) checks to be fully compliant, according to the protocol’s press release.
Clearpool’s move to build on Polygon is significant because borrowing and lending activity on competitor protocols such as Maple and TrueFi largely occurred on Ethereum’s network.
Polygon is an Ethereum sidechain that offers cheaper, faster transactions by pooling transfers on its proprietary proof-of-stake blockchain while relying on Ethereum’s network for security. It has recently secured notable partnerships with Instagram and Starbucks.
Clearpool Prime’s launch highlights a growing trend of decentralized lending protocols targeting institutional capital with TradFi-compatible products after last year’s crypto implosion wiped out most of the businesses. Clearpool’s loan book has fallen below $10 million from $108 million since November, data from DefiLlama shows.
Colin Butler, Polygon’s global head of institutional capital, predicted that 2023 will be a pivotal year for institutional decentralized finance on this week’s CoinDesk’s Money Reimagined podcast.
MATIC, Polygon’s native token, has been among the top 10 cryptocurrencies this year, gaining about 68% since January 1, CoinDesk data shows.
