This was done through the use of the DAI stablecoin, which is collateralized by ETH. The MakerDAO partnership is the first of its kind, where a decentralized stablecoin was used to finance an unsecured debt on a real estate deal. This opens the door for other real estate companies to use DAI to issue unsecured debt. This partnership is a big step forward for MakerDAO, as it shows that real estate deals can be financed through decentralized collateralized stablecoins.
Tesla, the world’s leading electric vehicle company and second-largest publicly traded Bitcoin holder, closed a $7.8M financial deal with 6s Capital, a commercial lender powered by MakerDAO.
MakerDAO is pushing toward embracing real-world assets (RWAs) in more ways than one.
Maker’s governance proposal in March suggested that the project integrate undercollateralized lending protocols with RWAs. Community members criticized the move because it aimed to diversify and bolster reserves and collateral.
In addition, Maker integrated with asset finance protocol Centrifuge last year, allowing platform users to borrow DAI against non-crypto collateral, such as real estate, mortgages, and invoices.
MakerDAO’s co-founder Rune Christensen tweets under the username ‘RuneKek’ that 6s Capital’s deal with Tesla has been finalized, following an announcement on the Maker governance forum on March 30.
“A Maker vault was just used to finance a real estate deal with Tesla…RWA szn is coming sooner than you think.”
RuneKek, MakerDAO co-founder
The $7.8 million loan will be used to build Tesla’s new collision and repair center. Later this year, Tesla is expected to complete a second project that will increase its credit line to $14.2M.
A member of the MakerDAO forum commented on the news, saying ‘we closed our first deal with Tesla yesterday?’ Sounds good.
SixS Capital was created to facilitate loans via the MakerDAO protocol in response to the lack of credit during the covid pandemic. Tesla is one of the clients of SixS Capital. To finance real estate investments, the company works with automotive firms O’Reilly Auto Parts, Wawa, and Service King.
6s Capital accesses MakerDAO’s vaults via RWA Company. The RWA Co. website describes itself as “serv[ing] as a bridge between institutional borrowers and decentralized finance” by helping its clients access MakerDAO’s vaults.
Gregory Di Prisco, formerly of the Maker Foundation, is the CEO of RWA.
Firm representatives claim that they only work with clients who are “experienced loan originators with a diversified portfolio” or “asset managers seeking leverage or liquidity against diversified portfolios.”
As of now, RWA appears to have two clients: 6s Capital and Huntingdon Valley Bank.
Via this site.