With $ 2.9m Total Value Locked and $5.7m real world loans written, Florence Finance bridges on chain liquidity to real world lending. It’s like a bridge between cryptocurrency lenders and real world borrowers. In this article, I have interviewe Chiel Ruiter, the Duke of Florence Finance.

Mahsa: ‘Would you please introduce yourself and tell us how did you end up in the blockchain industry? what is your story?’

Chiel: ‘Sure. I’m Chiel Reuter, 55 years old. I started my blockchain journey in 2017–2018 when I helped a friend with the second ICO in the Netherlands for a company called Ockel, which made small hardware devices. It was a side project for me because I was interested in this space. It got me thinking about tokens and bitcoin, and that’s how I went down the rabbit hole.

Initially, I was more convinced about the idea of tokenizing shares than I was about bitcoin and its monetary aspects. I used to be an investment banker for almost 15 years and quit in 2015. After that, I worked as an interim director for SMEs in financial trouble. When COVID hit, that work dried up, and I had a lot of time on my hands. That’s when I got deeply involved in bitcoin and crypto.

I started consulting for Bitvavo, the largest exchange in the Netherlands, and worked with early blockchain founders at LTO Network, a hybrid layer 1 blockchain listed on Binance in 2017. They wanted to create a safe haven asset for their crypto gains because Tether, the main stablecoin then, had a lot of fear, uncertainty, and doubt surrounding it.

We thought building an alternative stablecoin where we could control the assets would be a good idea. Initially, we aimed to create a euro-denominated MakerDAO-type project, but it was too difficult. So, we ended up tokenizing a private credit fund, which is what Florence Finance is today. We started building during the previous boom, and now, four years later, we have a solid track record.’

Mahsa: ‘When was the first moment that the idea of Florence Finance came into your mind? why?’

Chiel: ‘I spent most of my career in traditional finance, mainly at Goldman Sachs for almost ten years, and later at UBS and Credit Suisse in the Netherlands, running their investment banking business. While I enjoyed my work, I began to see the downside. Facilitating access to global capital markets is good, but the increasing barriers to access are not. Banks, especially investment banks, contribute to this. I realized that meaningful change wouldn’t come from within the banks; it would have to be grassroots and from outside.

When I left banking, I wanted to do something hands-on. When the opportunity with Florence came along, it wasn’t my idea but that of my fellow founders. It struck me that I could get involved directly, be the project lead, and do something tangible by facilitating crypto liquidity for a societal problem — SMEs struggling to access finance and liquidity.

SMEs are incredibly important; they represent 90% of businesses and provide over 50% of jobs globally. Despite the focus on large companies, SMEs are where most of the economic action happens, and I felt a strong pull to support them. For me, Florence Finance was a perfect fit because it allowed me to continue my work with SMEs and align with my interest in blockchain.’

Mahsa: ‘What problem is Florence Finance solving?’

Chiel: ‘Florence Finance is a hybrid that aims to bring excess liquidity from the crypto sphere to the real economy. While buying US treasuries is the easiest and most popular option due to their liquidity, it doesn’t really help anyone because the treasury market is already liquid. We wanted to connect crypto liquidity to a part of the real economy where it could do real good and provide better yields.

Initially, when we started, there were negative yields, and we couldn’t compete with platforms like BlockFi and Celsius, which offered high-interest rates. We decided not to compete on yield but on transparency and merit. We aimed to show exactly where the money comes from and what it is used for. This was different from the opaqueness of some other platforms.

However, it’s been challenging to scale up, even though we’ve proven the concept over four years. The key now is to attract more users who see the value in what we offer.’

Mahsa: ‘Would you mention some of the recent updates, partnerships, and advancements?’

Chiel: ‘This year, we’ve focused on building our community. We had a token generation event in January, which brought a lot of attention to our project. We’ve also secured our first centralized exchange listing. The next big step is to increase user adoption. We’ve realized the importance of making our protocol accessible to retail users, so we moved to Arbitrum, a lower gas fee environment.

We are also in the process of moving to Base, as we believe that Coinbase’s large user base will provide us with the right audience. Our aim is to attract users who may not be familiar with on-chain activities but are interested in safe savings products. Over the next six months, we hope to see higher adoption on Base compared to Ethereum or Arbitrum.’

Mahsa: ‘Can you name some of your competitors? What makes your project stand out among your competitors?’

Chiel: ‘There are many lending protocols, each with its niche. Broadly, they fall into two categories: those tokenizing already securitized assets, like treasuries or publicly listed shares, and those tokenizing real, tangible assets that lack distribution or liquidity, like real estate, music rights, or SMEs. We focus on the latter.

I don’t see others as competitors but as fellow innovators. We need many projects trying to break open access to credit using blockchain technology, which allows for transparency and fairness. One project I admire is Goldfinch, which focuses on microcredit in emerging markets, similar to our focus on SMEs. SMEs are starved for credit, even in developed economies, and Florence Finance aims to address this.’

Mahsa: ‘Is there anything else you would like to share about Florence Finance?’

Chiel: ‘I’d love for people to check out our platform, join our Discord, and follow us on Twitter. We have a vibrant community and a strong track record of providing yields between 7% and 10% with no credit mishaps so far, though, of course, we’re dealing with real credit risk in SME lending. We’re building a grassroots effort to make a real-world impact using blockchain technology.’

Mahsa: ‘What is your message to the people who have not invested in the blockchain industry yet?’

Chiel: ‘That’s a great question. I believe we are shifting from a speculative focus in crypto to one based on real use cases. Dollar stablecoins, for example, offer tremendous value, especially in countries with unstable currencies. As more people see the practical benefits of blockchain, like easy and unrestricted transfers of any amount of money globally, adoption will increase.

Once people experience how much better and easier it is, there’s no turning back. I used to get frustrated with the banking system, but now, with blockchain, I can manage my finances without all the hassle. It’s about seeing the potential and understanding that this technology can make things simpler and more efficient for everyone.

Watch the interview on my YouTube Channel:

About Crypto Diva

I’m already in the Future… Meet me there! Blockchain Technology is my passion and I have dedicated my career and research path to DeFi. My ultimate goal is to encourage more female professionals in the DeFi industry.

As the Sales and Marketing Manager of coinIX & COINVEST, I’ve got the privilege of being in close contact with Blockchain investment firms, as well as the innovative web3 projects which are creating the foundations the future financial world. I love to make the impossible possible and i’m willing to go the extra mile for that. Be my companion in my DeFi journey and I’ll show you everything.

Peace & Love,

Your Crypto Diva

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