Galaxy Ventures, the venture capital arm of Mike Novogratz's Galaxy Digital, has led a $20 million funding round for Fence, a startup aiming to transform the $6 trillion asset-backed finance market by utilizing blockchain technology behind the scenes. The round also included investments from Parafi Capital and Crane Ventures. Fence is developing software to manage the operational layer of structured credit deals, which currently relies on manual workflows, spreadsheets, and fragmented systems. By replacing these processes with a single, real-time system, Fence seeks to increase efficiency and provide investors with greater visibility into their assets.
According to Juan Montero, co-founder and CEO of Fence, the company's approach can reduce costs for large asset managers and has already shown promising results in deals with BBVA, one of Spain's largest banks. Fence's use of blockchain is focused on back-end operations, utilizing smart contracts to manage cash, collateral, and deal terms, rather than promoting tokens or crypto wallets to banks and asset managers. The company has already overseen approximately $1.5 billion in assets across its platform, working with firms such as BlackRock and Fortress, and plans to expand its operations in the U.S. and further develop its product with the newly acquired funding.