【S&P launches risk assessment framework for on-chain lending vaults as the sector reaches $10 billion】
S&P Global Ratings has announced a new risk assessment framework for on-chain lending vaults, marking the formal entry of a traditional rating agency into this niche sector. Data shows that deposits in on-chain lending vaults have grown from $1.5 billion two years ago to $10 billion today. The new framework will assess risks across several dimensions, including credit, liquidity, managers, blockchains, protocols, security, and governance. Results of the first vault assessments will be announced in due course. The initiative aims to improve transparency in the on-chain lending market by introducing standardized external credit assessments, and could influence expectations around institutional capital allocation to these vault products. The market will be watching for the vaults included in S&P’s initial assessments and their specific ratings to gauge the impact on the valuation of individual vault protocols.
S&P Global Ratings has announced a new risk assessment framework for on-chain lending vaults, marking the formal entry of a traditional rating agency into this niche sector. Data shows that deposits in on-chain lending vaults have grown from $1.5 billion two years ago to $10 billion today. The new framework will assess risks across several dimensions, including credit, liquidity, managers, blockchains, protocols, security, and governance. Results of the first vault assessments will be announced in due course. The initiative aims to improve transparency in the on-chain lending market by introducing standardized external credit assessments, and could influence expectations around institutional capital allocation to these vault products. The market will be watching for the vaults included in S&P’s initial assessments and their specific ratings to gauge the impact on the valuation of individual vault protocols.