Ethereum-based credit platform Porter Finance closed its bond issuance platform, citing a lack of lending demand from the decentralized finance (DeFi) ecosystem, developers said on Wednesday. The move comes amid declining crypto prices as broader equity markets reflect recession concerns.

The service enabled decentralized autonomous organizations (DAOs) to issue bonds as a means of raising funds in return for paying yields to users. These bonds provided a flexible, long-term credit option that offered advantages over loans for the protocols.

However, in Wednesday’s note, Porter said it was “not confident” that there would be large inflows of lending demand for fixed-income DeFi products such as those offered on its platform.

This was primarily due to the competitiveness of rates offered in traditional finance and the lack of institutional fixed income DeFi adoption over the past year, the note said.

Porter founder Jordan Meyer said the platform was also shunning legal risks with the move. “We are also no longer willing to take on the legal risk associated with bond offerings,” Meyer said, without saying what those risks might be. “For these reasons, we are pivoting away from the bond issuance platform and exploring better opportunities.”

Porter did not immediately respond to requests for comments at press time.

Meyer said the move did not affect obligations that Ribbon DAO – which used Porter to issue its bonds – has to its lenders. “Ribbon DAO is still bound by its promise to repay,” he said.

Ribbon holds over $71 million in various cryptocurrencies, trackers show. Porter launched in 2021, and raised $5 million in a seed round in April 2022.

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