Announcing Our Investment in 3F Labs: The Onchain Leverage Rail for RWAs

In traditional finance, leverage rails such as repo markets, securities lending desks, prime brokers, and fund financing lines form the core infrastructure of global credit and liquidity creation. These mechanisms finance collateral and, in turn, facilitate the vast majority of asset flows across the financial system. The result is an immense, interconnected network of market participants, with the repo market alone generating over $12 trillion in daily gross flows.

Since the global financial crisis, however, these leverage rails have become increasingly constrained. Post-2008 reforms reshaped banks’ ability to engage in financing activity, reducing their willingness to extend balance sheet for anything outside the highest-quality collateral for the largest financial market participants. As a result, efficient financing is largely limited to assets like U.S. Treasuries, while access to leverage for a broad range of other assets remains structurally constrained.

At the same time, demand for leverage remains persistent. There is an estimated $28-38 trillion in unmet demand globally. Much of this demand is driven by funds seeking to enhance returns through leverage, particularly in macro and relative value strategies that rely on repo, margin financing, and derivatives. While leverage is readily available in deep, liquid markets, the majority of yield-generating assets remain under-financed by traditional leverage rails.

In parallel, billions of dollars of real-world assets are moving onchain. Issuers are increasingly turning to blockchain infrastructure for more efficient distribution and new forms of access. Since the beginning of 2025, the value of tokenized assets has grown nearly 5x to approximately $27 billion.

3F sits at the intersection of these two dynamics. The team is building a modular, transparent, and scalable leverage system designed to bridge the gap between the demand for leveraged yield and the limited supply of financing. At its core, 3F enables a broader set of market participants to access leverage against RWA collateral through purpose-built onchain infrastructure.

In the near term, we believe 3F will unlock a new class of DeFi strategies powered by fundamentally different sources of yield than prior cycles. For the first time, crypto users can easily access leverage against tokenized financial assets tied to real-world economic activity. We have deep conviction that these RWA-based strategies will rearchitect the yield engine of the onchain economy.

Over time, we believe this system will extend well beyond crypto-native users. Access to leverage against a broad set of yield-generating assets, historically limited to the largest institutions, can now become widely accessible. We believe this will be a key driver of RWA adoption beyond the crypto-native audience, and will play a pivotal role in catalyzing the growth of the crypto industry in the years to come.

We see 3F as an early building block in a new global leverage layer, and we’re excited to support the team as they bring it to market. Sonya Kim and Romeo Ravagnan bring a rare combination of DeFi-native experience and deep TradFi expertise that we believe is essential in today’s market, and are uniquely positioned to bring together the right participants to scale the platform.

We couldn’t be more excited to back the team on this journey.