Stratos awards $5 million to REZI after defaulted loan

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Stratos awards $5 million to REZI after defaulted loan

Stratos awarded $5 million of the funds to REZI, a real-estate tech firm focusing on apartment rental properties in major U.S. cities, which has now stopped paying and is expected to write down the position to zero.

Another $2 million of the funds, dedicated to something it called POKT - was allocated to 'digital asset investments' Warbler Labs, Warbler Labs said in a statement. Stratos sold the portfolio at a near-full loss and added loan collateral to cover the shortfall.

The soured loan highlights the risks of tokenized real-world assets such as private credit, which has become one of the latest trends in a crypto industry hungry for something to get excited about as capital inflows dried up. It also brings under scrutiny the due diligence process performed on blockchain-based RWA lending protocols, especially after last year's string of defaulted loans to crypto trading firms.

The development followed another credit event of a Goldfinch pool earlier this year, when African motorcycle taxi financing company Tugende defaulted on a $5 million loan set to mature this October. The borrower breached loan covenants by making intercompany loans to stem the financial hardship of a sister company, Goldfinch said in a statement.