M11 Credit Restarts Crypto Lending on Maple Finance After FTX Fallout – Here’s What You Need to Know
Blockchain-based financing firm M11 Credit has resumed crypto lending on the decentralized credit marketplace Maple Finance.
The news of the resumption of service was announced in a Twitter thread from M11 Credit on Wednesday, where the firm also said it had upgraded its underwriting and monitoring framework.
The new lending pool will have an expected annual yield of 10.75% in the stablecoin USD coin (USDC) with a 60-day duration, the firm said.
Pool parameters (target):— M11 Credit (@M11Credit) April 5, 2023
– Single borrower exposure
– Expected net APY: 10.75%+ in $USDC
– Duration: 60 days with liquidity on demand afterwards
The firm provided further details about the new lending service in a blog post published by Maple Finance, which emphasized the improved risk management framework and credit policy that the firm has implemented.
According to the blog post, the new liquidity pool will offer lending only to selected clients, described by M11 as “premier low-latency trading firms with market-neutral strategies that have a strong and established track record of borrowing from M11 Credit pools.”
Further, M11 also said it had appointed a new Head of Credit who will be responsible for overseeing the lending business following the FTX bankruptcy.
“The expanded Pool Delegate team has established an enhanced underwriting process and credit policy and is implementing real-time monitoring tools for both on and off-chain assets,” the blog post said.
$36 million in defaults following FTX collapse
Liquidity pools managed by M11 Credit suffered $36 million of defaults, while several loans saw missed payments and were restructured after FTX filed for bankruptcy in November last year.
At the same time, Orthogonal Trading, one of the largest borrowers on M11, was accused of misleading M11 and Maple Finance by misrepresenting how much it had lost in the FTX collapse, leading to losses of up to 80% for investors in the affected M11 pools.