Spark announced on Wednesday the launch of Spark Prime and Spark Institutional Lending services to direct more of its decentralized finance (DeFi) stablecoin reserves to institutional lending markets.
Spark, a decentralized asset allocation entity whose principal collaborator, Phoenix Labs, previously worked on the MakerDAO stablecoin and risk architecture, he said the suite is designed to enable borrowers to access stablecoin loans without having to run their own DeFi operations.
Spark Prime offers margin lending and over-the-counter settlement powered by Spark’s liquidity engine, while Spark Institutional Lending connects Spark-managed marketplaces to qualified custodians such as Anchorage Digital, so customers can hold collateral in a regulated custody system.
Spark Prime’s early launch partners include Edge Capital, M1 and Hardkor Labs, according to Spark.
Phoenix Labs co-founder and CEO Sam MacPherson told Cointelegraph that institutional loan commitments are already around $150 million and have the ability to “scale into the billions in the coming months,” while Spark Prime starts at around $15 million and will grow more slowly as it implements “key security features.”
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Spark relies on Coinbase and PayPal offerings
According to data from DeFi Llama Spark’s total value locked (TVL) now stands at $5.24 billion, up from a high of $9.2 billion in November 2025, placing it among larger DeFi money market platforms by assets.
For comparison, Aave is currently the leader in DeFi lending with $27 billion in TVL, while Maple has $2.1 billion.
Spark says it has provided more than 80% of USDC (USDC) liquidity to Coinbase’s Bitcoin-backed lending marketplace at Morpho, helping boost loan growth by approximately $500 million in the first three months. Public desktops show Since launch, Spark-connected vaults have deployed over $600 million in this market.
PayPal’s PYUSD stablecoin program also leveraged approximately $500 million of Spark-managed liquidity to deepen onchain markets for PYUSD and other stablecoins.
DeFi resilience and market situation
Related: Vitalik draws the line between “true DeFi” and stablecoins with centralized yield
The launch also highlights how DeFi is holding up compared to overall token prices. Currently, the total value of DeFi TVL is $96.52 billion, down from approximately $120 billion at the end of January, a 20% decline during the last crypto sell-off compared to the broader cryptocurrency market.
During the same period, the price of Bitcoin (BTC) dropped from around $89,000 at the end of January to $66,800 on Wednesday, as of this writing, the decline was about 25%, while Ether (ETH) fell from about $3,000 at the end of January to about $1,950according to Coingecko data, a decline of approximately 35%.
MacPherson argued that one of the advantages of Spark’s model is that “anyone can evaluate the full portfolio in real time,” adding that institutions can underwrite its books based on their own limits and exits “if the profile is not consistent with their risk controls.”
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