Centrifuge, a decentralized finance platform, revealed its intentions in a Wednesday blog post to establish a lending protocol for real-world assets  aimed at institutions on Base, an Ethereum layer-2 network developed by crypto exchange Coinbase.

According to the post, the protocol will enable verified institutions to onboard RWAs and borrow against their RWA holdings.

Anthony Bassili, Coinbase’s head of allocators and tokenization, remarked, “We continue to see significant interest from our institutional clients for easier access to tokenization solutions on-chain.”

This development coincides with Centrifuge’s announcement of raising $15 million in venture capital investment in an “oversubscribed” fundraising round. ParaFi Capital and Greenfield spearheaded the investment, with participation from multiple firms including Arrington Capital, Circle Ventures, Gnosis, The Spartan Group, and Wintermute Ventures.

Following the announcement, CFG, the protocol’s native token, surged by as much as 14% before moderating gains, as per CoinGecko data. Despite a slight pullback, the token remained up by 5% over the past 24 hours, surpassing the sector benchmark CoinDesk DeFi Index’s  1% decline during the same period.

This development occurs amid intensifying competition in the RWA tokenization realm, as digital asset firms and global banks endeavor to migrate traditional financial products like bonds and credit to blockchain infrastructure to enhance efficiency, settlement speed, and transparency. Asset management firm 21.co projected the market for tokenized assets to reach $10 trillion by the end of the decade.

Centrifuge specializes in bringing structured credit products to blockchain, with rwa.xyz data indicating $270 million in active loans on the protocol.

Ben Forman from ParaFi Capital expressed confidence in institutional adoption, stating, “The Centrifuge team is a leader in real-world asset tokenization, taking a deeply thoughtful approach to design decisions around legal, regulatory, and smart contract architecture.”

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In a recent update to its terms of service, PayPal has announced significant changes to its buyer and seller protection policies for non-fungible token (NFT) transactions, effective May 20.

Under the new policy, NFT purchases will no longer be covered by PayPal’s buyer protection program. Additionally, NFT sales exceeding $10,000 will no longer be safeguarded against false claims, chargebacks, or other fraudulent activities that may result in financial losses for sellers.

A spokesperson for PayPal cited the evolving nature of the NFT industry and the uncertainty surrounding proof of order fulfillment as reasons for the policy change.

While the company published a notice about these changes on March 21, the updates went largely unnoticed until now.

According to PayPal’s policy updates page, the revisions to its Purchase Protection Program and Seller Protection Program will come into effect on May 20, 2024. The Seller Protection Program will exclude NFT transactions with a value of $10,000.01 or above unless the buyer claims an Unauthorized Transaction and meets all other eligibility requirements.

Previously, PayPal provided buyer and seller protections for NFT transactions, with the buyer protection program offering refunds for falsely advertised items, and the seller protection program reimbursing sellers affected by payment disputes and fraudulent refund requests.

Despite these changes, PayPal has demonstrated an increasing interest in blockchain-based digital assets in recent years. In 2022, the company introduced support for cryptocurrencies on its platform and filed a patent application for an NFT purchase and transfer system that includes provisions for user royalties.

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As geopolitical tensions fuel record highs in the price of gold, one might expect a surge in activity within the gold stablecoin market. However, historical trends reveal a rather subdued landscape in this niche subsector.

Tether’s XAUT and Paxos’ PAXG stand as the major players in the gold stablecoin market. Yet, compared to their dollar stablecoin counterparts, USDT and USDP, their market presence appears minimal. XAUT boasts a market cap of $580 million, while PAXG trails behind at just under $450 million.

XAUT’s supply has remained steady at around 246,500 units since March 2022, contrasting with PAXG’s declining supply from its peak of around 340,000 units in August 2022 to just 182,650 units presently.

Although trading volumes on centralized exchanges for these gold stablecoins have shown some increase, it’s important to note that the rise may be partly attributed to the escalating value of gold.

The 7-day moving average of trading volumes for both stablecoins reached relative peaks in mid-March but has since declined, despite the continued climb of gold prices. These peaks pale in comparison to previous highs, such as during the 2023 regional banking crisis.

While volumes have slowly risen since hitting a low in May, recent events have seen a slight uptick. PAXG experienced a significant jump in volume to $71 million on April 13, the highest level since May 2022, following reports of Iranian drone attacks on Israel. Similarly, XAUT volumes increased, albeit to a lesser extent.

Despite these developments, $71 million in trading volume remains relatively low for a crypto asset. In contrast, larger dollar-pegged stablecoins often transact billions of dollars a day on-chain alone. On centralized exchanges (CEXs), dollar stablecoin volumes are notably higher, given their widespread use as a primary quote asset.

In conclusion, the gold-backed stablecoin market remains a niche subsector, despite the recent surge in gold’s popularity within the broader market.

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Tether (USDT) has formed a partnership with Fuze, a digital assets infrastructure provider, to bolster education and awareness about digital assets in Turkey and the Middle East. The collaboration, detailed in an official press release, entails a Memorandum of Understanding (MoU) between the two entities, outlining mutual objectives without legal binding.

The joint efforts between Tether and Fuze aim to cover a spectrum of educational aspects within the digital asset domain, including cross-border payment solutions, compliance, regulatory framework development, and education for local financial institutions.

Initiative to Drive Cryptocurrency Adoption

At the heart of the collaboration lies a set of educational initiatives aimed at nurturing the uptake of digital assets, including Bitcoin, Blockchain, and Stablecoins like Tether (USDT), specifically for facilitating cross-border transactions. These campaigns underscore the efficiency and accessibility advantages of employing digital assets compliantly, benefiting businesses and individuals across Turkey, the Middle East, and North Africa.

Paolo Ardoino, CEO of Tether, expressed enthusiasm about the collaboration, highlighting its potential to democratize access to digital assets in the targeted regions.

Educational Programs and Workshops

Tether and Fuze will collaborate on developing programs and workshops aimed at enhancing awareness and comprehension of digital assets and blockchain technology among local financial institutions and individuals. These initiatives will conform to evolving regulatory standards, ensuring compliance amidst regulatory changes.

Focus on Practical Utility of Crypto

Additionally, the partnership seeks to enlighten merchants and enterprises about the practical usefulness of digital assets such as Bitcoin and Tether for day-to-day transactions. Raising awareness and promoting adoption aims to showcase the tangible benefits of digital assets in routine operations.

Engagement with Financial Institutions

Efforts will extend to engaging local and regional banks and financial institutions, equipping them with knowledge and tools to effectively utilize stablecoins and digital assets for their clientele.

Fuze’s Co-Founder and CEO, Mo Ali Yusuf, emphasized the importance of educating stakeholders across all levels to accelerate the digital assets landscape and maximize opportunities while maintaining security and trust.

Market Performance and Challenges

Tether’s USDT recently surpassed a market capitalization of $100 billion, marking a 9% year-to-date growth. It maintains a substantial lead over its closest competitor, USD Coin (USDC), with a market cap exceeding $71 billion.

However, concerns about the quality of assets backing USDT persist in the crypto space, with a recent United Nations report citing Tron’s popularity in cyber fraud and money laundering activities in Southeast Asia. Tether has refuted these accusations, emphasizing its collaboration with law enforcement agencies and the traceability of its token.

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