Founder Spotlight: Ashish Anand from Brú Finance
When people think of DeFi, many mainly think about the exchange of fiat currency and cryptocurrencies. But DeFi can be so much more: one innovative and exciting DeFi use case is the tokenization of existing, real-world assets, and those tokenized assets being traded on a global scale can bring real benefits to people, who may not even be that interested in crypto or DeFi itself.
Take Brú Finance for example. Since 2020, they’ve been helping impoverished and under-educated farmers in India to tokenize their crops and other physical assets, and those farmers can use those tokenized assets as collateral to borrow from the platform. Brú Finance then takes the resulting asset tokens and combines them into bonds to be traded like other financial instruments.
We sat down with Ashish Anand, the CEO & Co-Founder of Brú Finance, to learn more about their origins, their recent testnet launch and soon-to-be-realized mainnet launch, as well as upcoming features and long-term goals for the Brú Finance platform.
Can you share a bit about how Brú Finance decided to move into the DeFi space? Were there any unique stories that inspired your business model?
In 2018, Blockchain was a hit topic, and our founding team began operating in the Blockchain space. We started working on the tokenization of real-world assets like real estate, equity, etc.
We determined that tokenization of the assets in and of itself shouldn’t be our only goal, and in addition, we should be developing lending protocols built around those tokenized assets.
Coming from a family with links to farming, I’ve witnessed the problems of farmers in getting the right prices for their crops first-hand since childhood. So we decided to apply the benefits of tokenized asset lending to solve the problems of farmers in getting better prices for their crops and access to finance, using tokenized commodity finance. Note that this was way before DeFi was even a word!
We first built Whrrl, our CeFi arm, in partnership with governments/banks in India, and now we’re extending the same platform to implement DeFi lending at Brú. We’re creating a global, borderless, and bankless financial ecosystem that serves the un/underbanked population.
Brú Finance has been operating for several years: having already tokenized agri-commodities worth 600M USD and with thousands of existing customers, the traction Brú already has is very exciting! Can you speak about some of your previous work before the current iteration of the Brú Finance platform?
Before the commercial launch of Whrrl, the CeFi arm of Bru, we were granted the approval for a pilot run in Maharashtra, India, covering 16 custodian warehouses across 5 locations in January 2020. We were the first independent blockchain platform in the country to cross the $5 million transaction mark within 3 months of launching a pilot. We have been building since then and today have a network of 1,400 warehouses with 2 million metric tonne storage capacity, 18,000 farmers participating, and 15,000 agri-supply chain players on the platform.
Do borrowers (i.e., farmers) who have their assets tokenized need to be crypto-savvy to use the system? Do you see any issues with adoption due to low technology skills on the part of potential borrowers?
No! The borrowers don’t need to be crypto-savvy! Our system has been designed in such a fashion that even borrowers who don’t have a mobile phone can interact with blockchain using kiosk computers in warehouses, where they are assisted if they need technical help.
And after leaving the warehouse, borrowers can use a special mobile app/web app solution to track the status of their assets.
Independent auditing of tokens and tokenized assets sounds like a crucial part of having lenders and borrowers trust the system. How does 3rd party verification occur?
In agricultural supply chains, there are existing players known as “collateral managers” whose job is to provide an assessment of the quality and quantity of the commodity stored in warehouses.
They are appointed by lenders themselves to keep the assessment process objective. These audits take place pre-sanction of loan and also post-sanction at regular intervals.
These external auditors use a combination of physical inspection and machine/lab-based certification to assess the quality and quantity of commodities.
Can you provide an example of how Brú Finance connects both sides of a transaction?
Certainly! Farmers deposit their commodities/agricultural products in our warehouses: these warehouses are connected to our blockchain and thus every deposit gets converted into an RWA NFT.
These NFTs are locked into smart contracts, creating a pool of assets. The pool of assets will be fractionalized into bonds each of USD $1,000 denomination and with 6 months maturity.
The liquidity providers can subscribe to these bonds and the commodity owners can borrow from the platform using the mobile app.
How are the Brú Finance testnet trials going?
The testnet launch took place in June 2022 and we had more than 11,700 community members test the testnet, with more than 1,800 transactions totalling over $6M in trades. We received lots of great feedback from the testers, and many of their suggestions were added into the platform!
What upcoming features can investors and/or borrowers look forward to?
After our mainnet launch, our industry-first Emerging Market Asset-Backed Bonds will be opened up to global investors, creating a unique opportunity for them to make a significant social impact while also earning stable yields on their investment.
We are looking to launch ESG bonds, tranched securitized pools, i.e. junior/senior/mezzanine pools, which will be a secondary market where these bonds can be traded over a period of time.
In addition, you will be seeing more geographic locations and more asset types on the Brú platform in the future.
How can people get started with Brú Finance?
People can join us on any of our community platforms listed below, and they can also visit our website, where they can try out our testnet and also fill out the early adopter whitelist form. The early adopter program is a whitelist for liquidity providers that gives them the opportunity to be part of an early LP pool which will have higher levels of token yield, given the construct of the bonding curve.
For further inquiries, anyone in the community could reach out to our community moderators on any of our community platforms, or they can email us at hello@bru.finance.
Brú community platforms:
