Cryptocurrency firm Framework Ventures has partnered with mortgage services company Better to lend a hand it launch a $500 million integration plan with decentralized finance protocol Sky, formerly MakerDAO.
Better he said on Monday, the framework would lend a hand it provide $500 million in credit to the Sky stablecoin ecosystem, allowing it to launch mortgage-linked tokens that would generate yield.
Framework Ventures co-founder Vance Spencer said real-world assets are “one of the most important frontiers in decentralized finance, and government-backed mortgages are one of the largest real-world asset classes.”
The plan comes amid broader interest in tokenization from classic financial firms, with companies such as BlackRock pursuing tokenization for money market funds.
Tokens only for accredited investors, but will grow
Fortune reported on Monday, Framework also entered into an agreement to purchase 10% of Better shares, currently valued at approximately $45 million, and that the planned tokens will initially be available only to accredited investors.
Better founder and CEO Vishal Garg said he would issue tokens and then “figure out how to get that to consumers,” but didn’t say when the tokens would be launched.
Fortune reported that the retail tokens will be called “Home Token,” citing a person familiar with the plans.
This comes after shares of Nasdaq-listed Better (BETR) have struggled after hitting a high of over $86 in overdue October.
The company’s shares have since fallen, ending Monday at around $27, down almost 17% so far this year.
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Garg explained to Fortune that his entry into the cryptocurrency market was driven by the promise of lower fees and operating costs, and that there are “so many different layers of intermediation that we will be able to leverage.”
“If we can finance at a significantly lower cost than anyone else in the mortgage market, we will be able to offer consumers a much cheaper mortgage than anyone else in the market,” he added.
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