DeFi Upstart Dharma Brokers $6.4 Million in Crypto Loans in First 3 Weeks

Among these decentralized finance applications, San Francisco-based startup Dharma Labs is emerging as one of the industry leaders by facilitating more than $6.4 million worth for crypto loans since its peer-to-peer lending platform launched on April 8.

For comparison, Dharma has more than $10 million worth of ethereum in its system while the industry incumbent BlockFi garnered roughly $18 million in both bitcoin and ethereum deposits over the past month.

These Dharma loans are becoming a core part of the DAI ecosystem.

Polychain Capital, which in part helps guide the Maker Foundation that governs DAI through its voting power, is also an investor in Dharma Labs.

The rising DAI fees also increase Dharma interest rates, Foster said.

"As DAI slips under a dollar, trading at like $0.97, people can actually go buy DAI and lend it on Dharma for 11 percent annual [interest] rate," Dharma Labs business development manager Max Bronstein told CoinDesk.

Dharma investor and Autonomous Partners founder Arianna Simpson told CoinDesk some borrowers are using the crypto loans to "Level-up on ETH or refinance their [loans] on Maker."

"They're becoming the easiest place to earn a yield on your crypto or borrow cryptocurrency," Simpson said of Dharma.

In the meantime, the goal is for Dharma Labs to add support for bitcoin and more dollar-pegged stablecoins like PAX. Also, since the Dharma app uses a password and four-digit pin rather than complex crypto wallet keys, Simpson said the startup offers easier onboarding into the broader crypto ecosystem.

Dharma loans can transact directly with any self-custodied ethereum wallet, to send or receive money, rather than requiring direct integration with a specific wallet like the ConsenSys-owned browser app MetaMask.