A recent $20 million funding round, spearheaded by Galaxy Ventures, the venture capital division of Mike Novogratz's Galaxy Digital, is set to transform the $6 trillion asset-backed finance market by harnessing the power of blockchain technology. This investment, which also includes contributions from Parafi Capital and Crane Ventures, will support Fence, a startup dedicated to developing software solutions for the operational aspects of structured credit deals. The current system, often fragmented and reliant on outdated tools such as spreadsheets, PDFs, and email, can lead to slowed transactions and limited visibility for investors.
Fence aims to replace these antiquated processes with a unified, real-time data updating system, enabling lenders to continuously monitor loan performance and cash flows, rather than relying on periodic reports. According to Juan Montero, co-founder and CEO of Fence, this approach can significantly reduce costs for major asset managers, as evidenced by the company's collaborations with BBVA, one of Spain's largest banks.
By utilizing blockchain as a back-end solution, Fence streamlines cash, collateral, and deal governance management, eliminating the need for manual workflows and intermediaries. The company's platform currently oversees approximately $1.5 billion in assets, with a client roster that includes prominent firms such as BlackRock and Fortress. With this new funding, Fence plans to expand its presence in the U.S. and further develop its product, with the goal of revolutionizing the credit market's operational infrastructure.