Treehouse Finance, a decentralized finance startup based in Singapore, has reached a US$400 million fully diluted token valuation after a funding round completed late last year.

The round was structured as a simple agreement for future tokens (SAFT), according to CEO Brandon Goh.

The lead investor, who secured a board seat, is the venture arm of a major financial services firm managing over US$500 billion in assets.

Other backers include angel investors like Guy Young from Ethena, Darius Sit from QCP Capital, and Rich Teo from Paxos.

Founded in 2021, Treehouse aims to bring fixed-income products to decentralized finance. The platform has over 30,000 unique wallet holders and 120,000 ETH in deposits.

🔗 Source: The Block

🧠 Food for thought

1️⃣ DeFi’s fixed income sector targets a massive $600 trillion opportunity

Treehouse Finance is positioning itself within a rapidly growing segment of decentralized finance that aims to recreate traditional fixed income products on blockchain infrastructure.

The established fixed income market that includes bonds, loans, and derivatives represents over $600 trillion globally, which is five times larger than the equities and commodities markets combined 1.

This creates an enormous potential market for DeFi platforms, with the entire DeFi sector projected to reach approximately $26.81 billion by the end of 2025 and potentially $2.55 trillion by 2037, representing a compound annual growth rate of 45.4% 2.

Treehouse isn’t alone in targeting this opportunity. Competitors like Pendle Finance have already captured significant market share in the yield space and are working to expand beyond Ethereum to chains like Solana to access new capital pools 3.

The race to become the dominant infrastructure provider for DeFi fixed income highlights how blockchain applications are evolving beyond speculative use cases toward recreating fundamental financial services.

2️⃣ Benchmark rates represent a critical missing piece in DeFi’s financial infrastructure

Treehouse’s development of Decentralized Offered Rates (DOR) addresses a fundamental gap in the DeFi ecosystem that has hindered institutional adoption.

Traditional finance relies heavily on benchmark rates like LIBOR and SOFR to standardize pricing across financial products, but DeFi has lacked an equivalent system, resulting in inconsistent rates across platforms and complicated risk management 4.