I suspect the lacklustre demand so far for on-chain RWA securitisation is in part due to the extremely low cost of capital in the RW. Why bother with DeFi if there’s plenty TradFi sources of capital available willing to price generously? Right now Centrifuge et al. are competing with a wall of money from non-bank lenders that have stepped into the space. And mixing the two in your capital stack is hard (don’t know of anyone who’s done it).
But tbf it’s still early days. Over time I think originators will just add DeFi as another source of capital to their pool of options. Tokenising via Centrifuge is not particularly hard, and of course there’s intermediaries emerging (e.g. Fortunafi) to help with that. The cultural barrier you highlight is real, but the fintech boom in TradFi means incumbents are being quickly replaced by more tech savvy — shall I say crypto native — competitors.
By integrating with RWAs - aren't you moving from being correlated to crypto to being correlated with tradfi instruments?
Doesn't crypto stop being a hedge against fiat?
I suspect the lacklustre demand so far for on-chain RWA securitisation is in part due to the extremely low cost of capital in the RW. Why bother with DeFi if there’s plenty TradFi sources of capital available willing to price generously? Right now Centrifuge et al. are competing with a wall of money from non-bank lenders that have stepped into the space. And mixing the two in your capital stack is hard (don’t know of anyone who’s done it).
But tbf it’s still early days. Over time I think originators will just add DeFi as another source of capital to their pool of options. Tokenising via Centrifuge is not particularly hard, and of course there’s intermediaries emerging (e.g. Fortunafi) to help with that. The cultural barrier you highlight is real, but the fintech boom in TradFi means incumbents are being quickly replaced by more tech savvy — shall I say crypto native — competitors.