Galaxy Digital leads $20 million investment in Fence to overhaul back end of $6 trillion credit market
Startup Fence uses blockchain technology and tokenization in the background to automate processes that many asset managers still rely on manual workflows.
What to know:
- Fintech firm Fence raised $20 million in a funding round led by Galaxy Digital to modernize the largely manual $6 trillion asset-backed finance market.
- The startup uses blockchain, smart contracts and tokenization behind the scenes to automate loan tracking, reporting and payments, but it doesn’t want to be seen as a “blockchain company,” CEO Juan Montero said.
- The company works with major clients such as BBVA, BlackRock and Fortress, and plans to use funds for expanding in the U.S.
In this article
That layer — from tracking loan pools to verifying collateral and moving cash — is often fragmented across multiple firms and still runs on spreadsheets, PDFs and email. The setup can slow transactions and leave investors with limited visibility into the assets backing their investments.
Fence aims to replace those processes with a single system that updates data in real time, Juan Montero, co-founder and CEO of Fence, told CoinDesk in an interview. Lenders can monitor loan performance and cash flows continuously, rather than relying on periodic reports, he explained.
The company says that approach can cut costs for big asset managers. In deals with BBVA, one of Spain’s largest banks overseeing $800 billion in assets, Fence reported lower funding costs for borrowers and reduced operational work, while tracking large volumes of loans on an ongoing basis.
