Teylor Partners with Taurus to Tokenize SME Loans, Aims to Boost Liquidity and Investment
Summary:
German fintech firm Teylor has collaborated with digital asset provider Taurus to tokenize small and medium enterprise (SME) loans. By tokenizing portions of the loan portfolios, new investment opportunities are being diversified and a secure, blockchain-based secondary financial market is opening up. This move aims to raise capital for SMEs and increase liquidity. The initiative is set to begin with Ethereum and eventually be expanded to other blockchains like Polygon and Tezos.
German fintech entity Teylor has partnered with Taurus, a provider of digital asset infrastructure, to convert loans for small and medium-sized enterprises (SMEs) into tokenized assets. As part of their partnership, Teylor will originate and manage SME loans through its own platform, with certain portions of this credit portfolio being tokenized on Taurus' platform and TDX-regulated marketplace. This method allows private debt investors to securely partake in the returns through the blockchain-based secondary market. Tokenizing SME loans provides a new way for these businesses to gather capital and increase liquidity while diversifying investment opportunities. Prior to this, Italian group Azimut tokenized its first portfolio of SME loans through Sygnum Bank in 2021. In the same year, Defactor Labs, a decentralized finance (DeFi) lending platform, tokenized Alpha Bonds worth $100 million using the ERC-3643 token standard. These bonds were then lent to SMEs using tangible assets like receivables as collateral and were tokenized on the Polygon MATIC network. Taurus confirmed plans to begin this initiative with Ethereum before expanding to other blockchains like Polygon and Tezos in the future. Lamine Brahimi, a founding partner at Taurus, noted that private SME debt presents trading challenges as secondary markets are restricted to institutional investors. However, Teylor's scheme allows smaller investments and token trading on the TDX marketplace, pioneering the tokenization of private debt portfolio in Luxembourg. Last year, Spanish banking giant Banco Santander chose Taurus to protect the Bitcoin and Ether of its Swiss clientele.
Published At
12/14/2023 4:37:13 PM
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