Porter Finance Confirms Suspension Of Bond Issuance Platform

Porter Finance founder Jordan Meyer has confirmed that the binary options broker "will be shutting down its bond issuance platform."

"Looking forward, we are not confident there will be large inflows of lending demand for fixed income DeFi products like the ones offered through Porter Finance," he said in a blog post Tuesday.

Porter Finance is the first credit marketplace built for decentralized autonomous organizations (DAOs).

Meyer pointed out the "competitiveness of rates offered in traditional finance" and the "lack of institutional fixed income DeFi adoption over the past year" as the reason for Porter Finance's decision to close the bond issuance platform.

"We are also no longer willing to take on the legal risk associated with bond offerings," he added, hinting that there might be a lack of resources to back the firm if it enters into a legal dispute.

Meyer also revealed that the users of Ribbon DAO, a DeFi protocol that uses derivatives like options to generate sustainable, risk-adjusted yields, need not worry about their returns.

Last month, Meyer announced the launch of Porter Finance with the Ribbon DAO bond issuance on Ethereum mainnet. The latter offered 3,103,224 Convertible Bonds, redeemable for 1 USDC on the maturity date of December 4, 2022.

"The closing of the platform is independent of and does not affect Ribbon DAO’s obligation to its lenders. Ribbon DAO is still bound by its promise to repay," Meyer's blog post stated. "The app located at https://app.porter.finance will remain live until all Ribbon DAO lenders redeem or convert their bonds."

Meyer explained that the smart contract associated with the Ribbon DAO bond issuance is immutable and Porter Finance is not required to intervene in the repayment, conversion, or redemption of the Ribbon DAO bonds.