Huma Finance expects the partnership to drive $10 billion in payments-financing transactions within the next year.
Huma Finance, based in San Francisco, raised $38 million to expand its payment financing (PayFi) platform. The company plans to use this funding to launch on two new blockchains, Solana and Stellar’s Soroban smart-contract network, aiming to broaden its reach in tokenized real-world assets (RWAs).
Huma’s Dual Strategy Drives RWAExpansion
The recent $38 million funding round for Huma Finance adopts a dual strategy. First, $10 million comes from a direct equity investment led by venture capital firm Distributed Global. Other notable participants include Hashkey Capital, Folius Ventures, Stellar Development Foundation, and TIBAS Ventures, affiliated with Turkey’s İşbank.
The remaining $28 million is tied to yield-bearing real-world assets, seamlessly integrated into Huma’s platform. The Stellar Development Foundation played a key role here, contributing $10 million.
Huma’s co-founder, Erbil Karaman, shared details on these RWAs, explaining they are structured as multi-layer bonds with different maturities, bundled into exchange-traded products (ETPs) issued by Arf Capital, a Swiss firm. This approach follows Switzerland’s digital ledger technology (DLT) laws, ensuring regulatory alignment.
Tokenized RWAs are quickly gaining traction within blockchain applications. Financial institutions and digital asset companies worldwide are actively looking at blockchain to improve traditional assets like bonds, credit, and investment funds. This shift could lead to faster transactions, greater transparency, and operational improvements.
Huma’s PayFi platform focuses on tackling liquidity issues in trade finance. By using blockchain, the company offers a more streamlined and accessible alternative to older systems.
Partnership to Drive $10B Payments by Next Year
Huma Finance merged with Arf in early 2024, aiming to enhance its focus on real-world asset (RWA) tokenization. Despite the merger, both companies continue to operate independently under a shared holding company. Together, they offer a full-service platform for tokenized assets. Looking ahead, Huma expects the partnership to drive $10 billion in payments-financing transactions within the next year.
“Huma’s PayFi network marks a paradigm shift in payment financing, bringing essential liquidity and interoperability to an industry long plagued by inefficiencies and limited access,” remarked Chao Deng, CEO of Hashkey Capital, a prominent investor in Huma.
Huma Finance’s recent investment round signifies a critical step towards establishing a robust, blockchain-powered ecosystem for improved trade finance solutions. With expansion plans for Solana and Soroban, the company positions itself at the forefront of this burgeoning space.
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