In depth Analysis of the Highlights and Challenges of Huma Finance I participated in the AMA of huma finance @ humafinance @ DrPayFi yesterday and summarized the highlights and challenges of huma Highlights -Addressing the needs of the real world -New channel for on chain wealth management -Received strong support from Solana Fund challenge -The problem of scaling up the funding side -The problem of asset scaling -Lending risk or reduced company valuation Advantage 1 ⃣: Addressing the needs of the real world Huma has indeed solved the funding problem for cross-border payment companies, with practical implementation scenarios and already having many customers. Advantage 2 ⃣： New channel for on chain wealth management Human provides about 10% RWA financing, which is an important supplement to the 4% income of existing treasury bond type RWA financing. Although the risk is higher, it is also a way of asset allocation. Advantage 3 ⃣: Received strong support from Solana Foundation Huma is a top project in the Payfi track, and Payfi is a key focus of Solana's efforts, so it has received strong support from the Solana Foundation. I would like to commend the Solana Foundation and Solar @ Solana_zh for their significant support to ecological projects. Challenge 1 ⃣: The problem of scaling up the funding side The DUNE board shows that the current 2C USDC deposit of HUA is $14 million, which is still relatively small, less than 0.1% of AAVE's. Compared to small loan technology companies, this size is also very small, for example, Lexin's loan balance is $15 billion. I interviewed several users in the community, and they said that the reason they did not participate in the deposit was because they felt it was risky. So whether Huma can obtain low-cost large funds from the chain remains to be tested. Challenge 2 ⃣: The problem of asset scaling At present, Huma's main assets are payment advances from cross-border companies, but 2B's business is difficult to scale up. Because each customer has different processes (including risk control/compliance/technical integration/debt collection, etc.), it is particularly challenging to conduct 2B business in different countries and regions. In the past, Internet small loan companies were able to scale up because all the processes were standardized, whether it was one user or one million users, all could be completed through one standard process. Challenge 3 ⃣: Lending risk or reduced company valuation The proportion of lending in Huma's business is relatively large, and lending is actually a financial business with issues such as bad debts and mismatched maturities. When fintech companies emerged in the industry, their valuations were very high because both venture capitalists and entrepreneurs believed that fintech was a tech company; However, as the industry matures, fintech companies with financial operations are gradually recognized as finance companies, and their valuations have been significantly revised. In addition, financial companies bear greater regulatory risks than technology companies. The well-known fintech company Qudian fell 80% in less than a year from its listing on the New York Stock Exchange due to changes in regulatory policies. At present, ondo and plume of rwa track have obtained a high valuation, because ondo is mainly a very low-risk treasury bond bond RWA, while plume is mainly a risk-free RWA Infra business, and Huma's current business form may not be able to obtain a similar valuation. If we refer to the small loan company Lexin, the loan balance is $15 billion and the market value is $1.15 billion, which is about 8% of TVL's market value. PS participated in the deposit of huma 2.0 and found the narrative and track to be good, with practical prospects for implementation. However, there are still many pitfalls in the scale of the business that need to be addressed by the team Welcome to discuss with friends who follow RWA and Huma @0x0xFeng @thecryptoskanda @starzqeth @BroLeonAus @0xNing0x @0x_Todd @Ice_Frog666666 @portal_kay @KuiGas