This episode reveals how Qiro Finance is building the critical underwriting infrastructure to bridge traditional credit markets with DeFi capital, tackling the adverse selection problem that has historically plagued on-chain lending.
Founders' Journey: From Fintech and DeFi to Qiro
- Akshay Poshatwar brings deep experience from India's fintech lending sector, where he worked with early-stage consumer lending platforms and later managed capital sourcing for a B2B marketplace, raising over $100 million in debt. His journey provided him with a hands-on understanding of the entire lending lifecycle, from origination to capital sourcing in traditional finance (TradFi).
- Nishikant Bahalkar entered the space from a data science and computer engineering background. His work building AI models for banks introduced him to finance and underwriting. He became deeply involved in crypto during the 2020 "DeFi Summer," gaining expertise in protocol mechanics and tokenomics while working with the early-stage fund GravityX Capital, where he and Akshay connected.
The Genesis of Qiro: Solving Adverse Selection in DeFi
- This disconnect creates a problem of adverse selection, an economic concept where lenders, due to a lack of information, attract higher-risk borrowers, leading to poor outcomes. In DeFi, the absence of robust underwriting means capital providers cannot accurately assess the risk of real-world assets.
- Akshay explains their realization: "That's when we saw there is a problem of adverse selection and there is an opportunity someone like Qiro can come and build that middleware to communicate between TradFi and DeFi."
- Qiro was founded to be this middleware—an infrastructure layer that provides the data, models, and standardized frameworks necessary for on-chain investors to confidently deploy capital into off-chain credit opportunities.
Bridging Global Credit Markets with On-Chain Capital
- In markets like India, multi-billion dollar lending books are built on unsecured loans, underwritten using transactional history and audited financials rather than hard collateral. This system evolved over decades, incorporating data science to price risk effectively.
- DeFi, being much younger, has not yet developed these nuanced risk models. Qiro aims to bridge this gap by creating standardized frameworks to evaluate diverse Real-World Assets (RWAs)—physical or traditional financial assets tokenized on the blockchain.
- Qiro’s infrastructure is designed to collect, streamline, and present data in a structured format, allowing liquidity providers to understand and compare the risks associated with different asset classes, from SME financing to invoice financing.
Making Real-World Assets (RWAs) DeFi-Ready
- Nishikant points out that long redemption times for traditional credit assets clash with the DeFi ethos. While a mature secondary market for these tokenized assets is the long-term solution, it is still 6-12 months away.
- For these secondary markets to function, market makers need a reliable way to verify and price the underlying assets. This is where Qiro's underwriting infrastructure becomes critical, providing the necessary transparency and data for fair valuation.
- As a near-term solution, Qiro focuses on sourcing short-term credit portfolios with underlying assets maturing in 7 to 30 days, which minimizes liquidity risk and serves as a practical workaround until a broader secondary market develops.
Unlocking Credit for Decentralized Physical Infrastructure (DePIN)
- DePIN projects are ideal candidates for on-chain financing because their operations and revenue streams are often transparent and publicly verifiable on the blockchain. This on-chain data provides a rich source for underwriting.
- Qiro is developing tailored credit products for DePIN, such as lines of credit for individual node operators or larger loans for entire networks to finance hardware expansion (e.g., purchasing more GPUs).
- Nishikant emphasizes the strategic fit: "Someone like Qiro can build a native marketplace for DePIN assets... you can think of having like one miner or thousands of miners pulled into a securitized pool and then you can have this cash flow stream into different tranches."
Team Growth and Strategic Hiring
- The team currently consists of 12 people, primarily focused on building the core product.
- They are actively seeking a business development professional, ideally based in New York or London, to help source on-chain liquidity and manage relationships with institutional capital providers.
- This role requires a deep understanding of both RWAs and the DeFi ecosystem, highlighting the specialized expertise needed to operate at the intersection of these two worlds.
Conclusion
This episode underscores that robust, transparent underwriting is the key to unlocking the full potential of RWAs and DePIN in DeFi. Qiro is positioning itself as the essential middleware to solve this. For investors and researchers, monitoring the development of such specialized credit infrastructure is critical for identifying opportunities in the next wave of on-chain finance.
