Maple Finance records a loss of $7M at end of 2022

Institutional crypto lending protocol Maple Finance has reported a net loss of about $7 million at the end of the fourth quarter of 2022 as it moves to close its lending pools on Solana.

Maple Finance was launched in May 2021 as a decentralized credit market for institutional borrowers and lenders. Since its inception, the lending protocol has offered over $1.9 billion in corporate loans.

However, the ripple effect of the prolonged bear market and FTX collapse has affected borrowers’ appetite for its loan offerings.

In Maple’s Q4 2022 Treasury report, the lending protocol disclosed that it originated about $87 million across 23 new loans, which is down by 67% compared to its record of $262 million in the third quarter. As a result, Maple closed the fourth quarter with total active liquidity of $58 million, as against $326 million when the quarter began.

Over the reporting period, Maple recorded a revenue of about $310,092, while its expenses stood at roughly $3.57 million.

Furthermore, Maple incurred a loss of $151,933 from its M11 Credit Pool due to Orthogonal Trading’s insolvency. As reported on Dec. 5, Maple severed business ties with Orthogonal Trading as the lending delegate was reportedly insolvent, leading to an expected loss of roughly $3 million

The Q4 report added that since Maple’s inception, its revenue-to-date stood at  $5 million, while its expenses totaled $12.1 million. Consequently, the crypto lender recorded a net loss of approximately $7 million by the end of 2022.

In efforts to cut operating costs, Maple said it will suspend all lending pools on Solana and reduce its quarterly expenses from about $2.4 million to $1.2 million.

With approximately $6.1 million in its Treasury, Maple said it will work to increase its runway up to 16 months in a zero-revenue environment.