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Clearpool Teams Up with Cicada to Develop Structured PayFi Lending Opportunities
In a groundbreaking move, Clearpool has partnered with Cicada to revolutionize the world of cryptocurrency lending. The collaboration aims to create structured PayFi Credit Pools that connect DeFi liquidity to short-term working capital lines for fintech operators. By doing so, it will provide an unprecedented level of transparency and professional oversight throughout the entire process.
Cicada, a blockchain-based credit risk management company founded by seasoned professionals from both buy-side and sell-side, will bring its expertise in underwriting loans over $850 million with a remarkable 1.2% default rate to the table. This means that Clearpool’s PayFi Credit Pools will benefit from calibrated limits, covenants, and monitoring designed to align borrower and lender interests while maintaining on-chain transparency.
To facilitate this innovative approach, Clearpool is developing cpUSD, a permissionless yield-bearing asset. This new product will enable retail investors to passively participate in the PayFi activity within predefined parameters. By integrating wallets and analytics, DeFi users can turn their digital assets into real-world yield-generating instruments.
The partnership between Clearpool and Cicada is expected to have significant implications for both decentralized finance (DeFi) and traditional fintech operators. The risk-managed PayFi Credit Pools will provide a platform for institutions to evaluate credit markets using established metrics, rather than relying on illiquidity or uncertainty associated with traditional lending methods.
On the other hand, this collaboration offers an unprecedented source of liquidity for fintech companies, which can reduce costs and optimize their operations by accessing settlement reality-based working capital.
Source: crypto-economy.com
