Taurus starts credit tokenization as an asset class for German SMEs

Teylor, a German-based fintech firm specializing in digitizing small business loans, has joined forces with digital asset infrastructure provider Taurus to turn small and medium enterprise (SME) loans into tokenized assets and provide tokenholders with monthly cashflows.

In the partnership, Teylor originates and manages SME loans through its Teylor credit platform. By tokenizing part of this credit portfolio on the Taurus infrastructure and TDX-regulated marketplace, professional private debt investors could participate in the returns through a secure blockchain-based secondary market.

Blockchain tokenization provides an alternative means for SMEs to raise capital and build liquidity while building diversified investment opportunities. In 2021, Italy’s Azimut group tokenized its first portfolio of loans to Italian SMEs through Sygnum Bank.

On June 6, decentralized finance (DeFi) lending platform Defactor Labs tokenized $100 million worth of Alpha Bonds using the ERC-3643 token standard. The bonds, tokenized on the Polygon MATIC network, were lent to small- and medium-sized enterprises using real-world assets, such as receivables, as collateral.

Speaking with a Taurus representative, Cointelegraph gathered that the Teylor Ledger-Based Security for SME Loans will start with Ethereum and be rolled out to other blockchains, such as Polygon and Tezos, later.

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According to Lamine Brahimi, Managing Partner and Co-Founder at Taurus, private SME debt is traditionally challenging to trade as secondary markets are limited to institutional investors. Teylor’s ledger-based security enables smaller investments and token trading on the regulated TDX marketplace, marking the first Luxembourg-based private debt portfolio tokenization.

In Nov, Spanish financial services giant Banco Santander selected digital asset management firm Taurus to safeguard its Swiss clients’ Bitcoin (BTC) and Ether.

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