Spark announced the launch of Spark Prime and Spark Institutional Lending on Wednesday to channel more of its decentralized finance (DeFi) stablecoin reserves into institutional credit markets.
Spark, a decentralized asset allocator whose core contributor, Phoenix Labs, previously helped design MakerDAO’s stablecoin and risk architecture, said its new suite is meant to let borrowers tap stablecoin loans without having to run their own DeFi operations.
Spark Prime offers margin‑style lending and off‑exchange settlement powered by Spark’s liquidity engine, while Spark Institutional Lending plugs Spark‑governed markets into qualified custodians such as Anchorage Digital so clients can keep collateral inside regulated custody.
According to Spark, early launch partners for Spark Prime include Edge Capital, M1 and Hardcore Labs.
Co‑founder and CEO of Phoenix Labs, Sam MacPherson, told Cointelegraph that institutional lending was already at about $150 million in commitments, with capacity “to scale to billions over the coming months,” while Spark Prime is starting with about $15 million and will ramp more slowly as “key safety features” are rolled out.
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According to data from DeFi Llama, Spark’s total value locked (TVL) is currently at $5.24 billion, down from a high of $9.2 billion in Nov. 2025, placing it among the larger DeFi money market platforms by assets.
By comparison, Aave currently leads DeFi lending with $27 billion in TVL, while Maple sits at $2.1 billion.
Spark says it supplied more than 80% of the USDC (USDC) liquidity for Coinbase’s Bitcoin‑backed loan market on Morpho, helping drive about $500 million in loan growth in the first three months. Public dashboards show Spark‑linked vaults have deployed more than $600 million to that market since launch.
PayPal’s PYUSD stablecoin program has also used about $500 million in Spark‑governed liquidity to deepen onchain markets for PYUSD and other stablecoins.
DeFi’s resilience and market backdrop
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The launch also highlights how DeFi has held up relative to token prices overall. Currently at $96.52 billion, the overall DeFi TVL has fallen from around $120 billion at the end of January, representing a 20% decline during the recent crypto selloff, compared with the broader crypto market.
Over the same period, Bitcoin (BTC) has dropped from about $89,000 at the end of January to $66,800 at the time of writing on Wednesday, a decline of about 25%, while Ether (ETH) fell from about $3,000 at the end of January to roughly $1,950, down around 35%, according to data from Coingecko.
MacPherson argued that one advantage of Spark’s model is that “anyone can evaluate the full portfolio in real time,” adding that institutions can underwrite its books against their own limits and exit “if the profile does not align with their risk controls.”
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