MakerDAO May Expand Non-cryptoasset Portfolio With BlockTower, Centrifuge

A $220 million “real-world asset” vault may soon be available to DeFi investors


Blockworks exclusive art by Axel Rangel


Cryptocurrency investment firm BlockTower Credit and DeFi lending protocol MakerDAO will vote on whether to fund $220 million in so-called real-world assets through Centrifuge.

If the vote passes, BlockTower will provide $70 million in junior capital —  that is, funds allocated to speculative activity and used for high-risk, high-reward investments — and Maker will approve $150 million in senior capital to create a $220 million pool on Centrifuge, a Berlin-based protocol that is bridging real-world assets to DeFi through tokenization. 

A community greenlight poll was passed on Aug. 15, with over 75% of MKR token holders voting in favor of including BlockTower Credit in the Maker Protocol via the Core Units. But further voting is required to complete the onboarding of real-world asset collateral in the Maker protocol.

“We believe Maker’s long term interests are best served through a diversified set of high-quality arrangers, credit exposures, and other partners — we look forward to helping Maker raise the bar,” Kevin Miao, head of credit at BlockTower, wrote in a governance forum post. 

Funding of real-world credit assets will be powered through Tinlake — a Centrifuge smart contract on the Ethereum network.

RWA owners are able to create a pool of their assets and offer it to DeFi investors on Tinlake. These assets will create a stable yield for investors and provide liquidity to issuers who set up and operate the pools. In the case of BlockTower and Maker, the proposed stable yield will sit at 4%.

According to Centrifuge, Tinlake’s smart contract eliminates a third party “trust layer” by embedding the process into the code. 

“We think it’s a prime example of how institutional investors are moving to safer crypto investments, ones that provide true utility and tangible ROI,” a Centrifuge spokesperson told Blockworks.

Centrifuge Tinlake has already brought over $25 million in assets to Maker through existing real-world asset vaults. 

Voting will go on chain on Friday Dec. 9 and a decision is expected to be made by early next week.

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