February 11 News, decentralized finance protocol Spark announced the launch of a new institutional lending infrastructure aimed at building a secure channel between on-chain capital and traditional financial systems. Through the two main products, Spark Prime and Spark Institutional Lending, Spark is bringing the most robust stablecoin liquidity in the DeFi space into the institutional lending market, which has long relied on off-chain methods.
Spark stated that these two services have expanded over $9 billion in deployed stablecoin liquidity to hedge funds, trading firms, and fintech institutions that need to meet custody and compliance requirements. According to Galaxy data, the off-chain crypto lending market is approximately $33 billion, indicating that many institutions remain cautious about directly engaging with on-chain assets, but the demand for crypto-related financing remains strong.
Phoenix Labs co-founder Sam MacPherson noted that the new system essentially involves over-the-counter crypto lending through qualified custodians, using an over-collateralization structure to reduce systemic risk. He emphasized that unsecured loans in the past caused serious consequences, but the new design significantly improves loan safety through risk controls and custodial segregation.
Spark Prime introduces a unified collateral framework, allowing borrowers to flexibly deploy collateral across centralized platforms, DeFi protocols, and qualified custodians, while managing liquidations under a single risk engine. The system is supported technically by prime broker Arkis, which can automatically trigger cross-platform liquidations when the combined risk exceeds thresholds, providing higher capital efficiency for high-frequency strategies like hedge funds.
Spark Institutional Lending targets institutions preferring a fully custodial model. By partnering with service providers like Anchorage Digital, borrowers can use custodial collateral within a regulated environment and access on-chain liquidity pools managed by Spark.
Previously, Spark has provided core liquidity support for several institutional products, including hundreds of millions of dollars for the 2025 Bitcoin lending project and stablecoin ecosystems. This upgrade signifies that Spark is gradually becoming a key infrastructure connecting stablecoin demand with global capital markets. (CoinDesk)
Disclaimer: The information on this page may come from third parties and does not represent the views or opinions of Gate. The content displayed on this page is for reference only and does not constitute any financial, investment, or legal advice. Gate does not guarantee the accuracy or completeness of the information and shall not be liable for any losses arising from the use of this information. Virtual asset investments carry high risks and are subject to significant price volatility. You may lose all of your invested principal. Please fully understand the relevant risks and make prudent decisions based on your own financial situation and risk tolerance. For details, please refer to
Disclaimer.
Related Articles
Hyperliquid "Invades" Wall Street: On-Chain Whale Paradise Faces Direct Compliance Pressure
Hyperliquid, as a leading Perp DEX, is rapidly rising and attracting whale players, with massive trading volume and users exceeding 1.729 million. However, facing the rapid development of on-chain finance, compliance and regulatory challenges are becoming increasingly prominent. Hyperliquid has established a policy center to address these issues and seek legitimate status in mainstream finance.
PANews8m ago
Bitdeer Announces February Operating Data: Hash Rate Reaches 68 EH/s, Mined 705 BTC
Bitdeer's mining and operational data disclosed in February 2026 showed that its self-operated hash rate reached 68 EH/s, with 705 BTC mined, representing a year-over-year growth of 541%. The AI cloud business is developing well, with 2,096 GPUs deployed and annualized revenue of approximately $21 million. The company is also negotiating leasing agreements with potential customers and plans to begin mass production of the SEALMINER A4-1 mining machine in March 2026.
GateNews17m ago
Messari Co-founder Eric Turner Steps Down as CEO, Diran Li Takes Over and Announces Layoffs
Messari, a cryptocurrency research institution, announced that co-founder Eric Turner will step down as CEO, with Diran Li taking over the role. Turner will continue to serve as an advisor. New CEO Li mentioned that personnel adjustments will be made, with multiple team members being laid off, and expressed gratitude for their contributions.
GateNews24m ago
Ethereum Founder Vitalik Buterin Wants Running a Node to Feel Less Like Rocket Science
Vitalik Buterin emphasizes simplifying Ethereum’s validator process by merging separate clients into one, enhancing user experience. He advocates for revisiting the architecture to ensure better accessibility and diversity among validators, mitigating risks from large staking pools.
Decrypt5h ago
Pi Network Starts Second Migration: Here’s What You Must Do to Be Eligible
Pi Network has initiated second migrations, allowing Pioneers to transfer more Pi to Mainnet, enhancing wallet security with two-factor authentication. This update may positively impact Pi Coin's market price, currently just below $0.20.
CaptainAltcoin6h ago
PancakeSwap Unveils PancakeSwap Town, an Immersive DeFi World With AI Agent-Integration
PancakeSwap has launched PancakeSwap Town, an interactive DeFi environment featuring AI-led tools. Users can control crypto strategies via a browser-based interface, utilizing AI assistance for swaps, yield farming, and liquidity management while retaining full transaction control.
BlockChainReporter8h ago
