Hat-tip to the analysts at Messari, whose comprehensive overview reveals Huma Finance is quietly reshaping global payment financing by bringing structured settlement liquidity onto the blockchain, tackling inefficiencies in traditional systems.
- Huma Finance is revolutionizing global payment financing by using blockchain to improve liquidity and efficiency in structured settlements.
- The platform operates through Huma Institutional for larger investors and Huma 2.0 for retail investors, collectively originating billions in credit across multiple blockchains.
- Huma’s roadmap includes scaling the platform for same-day settlement financing and integrating PayFi and DeFi, aiming for $10 billion in transaction volume by the end of 2025.
Traditional finance, for all its might, often moves with the speed of a snail in molasses when it comes to cross-border payments or credit card settlements. Think high fees, multi-day waits, and pre-funded accounts tying up trillions in capital globally. Huma Finance steps into this gap, offering a digital alternative that connects liquidity providers with borrowers through a blockchain backbone.
The protocol operates with a dual approach: Huma Institutional, a permissioned service built for the big players—think institutions and professional investors requiring KYC/KYB verification. Then there’s Huma 2.0, a permissionless avenue primarily for retail investors, designed for broader access.
To date, Huma has originated a hefty $2.3 billion in credit for various payment financing use cases, with a total transaction volume reaching $4.5 billion. It’s a significant footprint, operating across Solana, Stellar, and EVM-compatible blockchains, boasting 12 active lending pools.
The team behind Huma Finance is led by co-founders Richard Liu and Erbil Karaman, alongside Chief Business Officer Patrick Campos, who joined in February 2025. Liu brings an engineering background from Google, where he launched Google Fi, and was CTO at EarnIn. Karaman honed his product and growth strategy at Lyft, EarnIn, and Meta. Campos adds finance, blockchain, and regulatory expertise, having served as Chief Strategy Officer at Securrency.
Huma Finance has drawn substantial backing, securing $8.3 million in its Seed round from names like Distributed Global and Circle Ventures. A Series A round on September 11, 2024, added another $38 million, led by Distributed Global with participation from Hashkey Capital and the Stellar Development Foundation, which contributed $10 million. This funding underscores a clear belief in Huma’s vision.
Huma Institutional, the permissioned arm, features those 12 active lending pools spread across Solana, Polygon, Celo, Stellar, and Scroll. These pools are run by various PayFi protocols, including Arf, Jia, Rain, and BSOS, all of which have undergone audits. It’s a modular system, connecting borrowers, lenders, PayFi dApps, and the underlying blockchain infrastructure.
Borrowers, often small business owners, seek credit lines backed by future receivables or expected cash flows. Lenders supply capital to these pools, earning a share of the profits. A key piece of the puzzle here are Evaluation Agents (EAs), third-party entities that assess borrower creditworthiness, approve requests, set terms like interest rates, and manage defaults. Think of them as the underwriters of this new digital credit landscape.
Lenders have options, too. Pools offer either a uni-tranche (junior active) or a two-tranche structure (senior and junior). The Senior Tranche carries lower risk and lower yields, getting priority in loss recovery. The Junior Tranche, conversely, takes on higher risk for potentially higher returns, paid after the senior tranche. To cushion the blow, up to 16 types of first loss covers are implemented, such as extra collateral from the borrower or a reserve fund from the Pool Owner or EA, designed to absorb losses before they hit lenders.
Participation in Huma Institutional involves specific redemption mechanics, often with lockup periods of three or six months. Adding new funds resets the lockup for the entire deposit. Lenders must be qualified or accredited investors from non-restricted countries, completing KYC/KYB checks and accepting legal documents before they can participate. It’s a serious business, as you might expect.
Each lending pool has defined administrative roles to keep things running smoothly. Pool Owners create and manage pools, setting parameters and selecting the Evaluation Agent. The Protocol Owner handles overall administrative tasks, requiring a majority vote from a multi-sig wallet. Pool Operators support Pool Owners by reviewing KYC/KYB results and approving lenders. And the Evaluation Agents, as mentioned, act as underwriters, determining credit terms and managing defaults. Both EAs and Pool Owners must invest capital in their pools before other lenders can contribute, ensuring skin in the game.
The pool ecosystem is diverse, supporting protocols like Arf, a global liquidity platform for cross-border payments that merged with Huma in April 2024. Then there’s Rain, offering a digital asset-backed business credit card for Web3 companies, and BSOS, providing blockchain-based trade finance, even a Green Finance Pool for EV charging. Jia, meanwhile, focuses on microfinance for small businesses in emerging markets.
Arf stands out as a major player. As of April 30, it was the largest active pool on Huma, accounting for 98% of total credit originated. Monthly credit originated through Arf surged 200% year-over-year, from $65.7 million in May 2024 to $197.3 million in April 2025. This growth is largely due to Arf’s close collaboration and merger with Huma, aiming to remove working capital requirements and speed up cross-border settlements. They continue to operate independently under a unified holding company, a neat trick for synergy.
Then came Huma 2.0, launched on April 9, representing Huma’s future focus. Operating exclusively on the Solana blockchain, it largely removes the KYC/KYB hurdle for depositors, unless they’re from a restricted country or their wallet flags. This opens the door wider, doesn’t it?
Liquidity providers in Huma 2.0 can choose between Classic Mode, which offers a USDC yield (currently 10.5% APY) plus Huma Feather rewards, and Maxi Mode, which focuses solely on higher Huma Feather rewards. Lockup options (no-lockup, three-month, or six-month) increase Feather rewards, incentivizing longer commitments. Huma Feathers replaced the prior Huma Points program, a one-to-one conversion.
The deposited USDC in Huma 2.0 is managed by a strategy manager, deploying about 80% of capital into PayFi pools, like the Arf Pool on Solana, which generates over 12.5% yield. The remaining 20% goes into liquid DeFi strategies on platforms like Kamino, Aave, or Pendle, returning around 7%. This blended approach yields a net protocol return of approximately 11%, with a cost of capital to LPs around 10.5%.
Huma 2.0 has seen strong early traction. Since its April 9 launch, it boosted the cumulative number of depositors on the entire Huma Finance platform by 9.5x, jumping from 5,600 to 53,350 by May 21. It has attracted $50 million in USDC deposits, with 66.1% of that flowing into Maxi mode and 33.9% into Classic mode. Users clearly favor Maxi mode and longer lockup commitments to maximize those Feather rewards.
Looking ahead, Huma Finance’s roadmap aims to scale the platform and deepen its role in cross-border payment and credit card financing. A long-term goal is to support same-day (T+0) settlement financing for cross-border payments, a significant leap from current multi-day norms. Imagine the capital efficiency gains there.
A key technical priority involves addressing composability challenges between PayFi and DeFi, integrating these two worlds more seamlessly. Huma also commits to advancing PayFi education and community development across both crypto-native and traditional financial sectors, even co-hosting PayFi summits globally with the Solana Foundation. In the near term, Huma projects reaching $10 billion in all-time payment financing transaction volume by the end of 2025.
The HUMA token, with a maximum supply of 10 billion, will serve as a utility and governance token. It will compensate liquidity providers, community contributors, and ecosystem partners. Token holders can stake HUMA to earn rewards and participate in governance decisions, with longer staking durations granting greater voting power. At the Token Generation Event (TGE), the initial circulating supply was 17.33% (1.733 billion HUMA), allocated across initial airdrops, CEX listings, marketing, and liquidity. A second airdrop of 2.1% is planned approximately three months post-TGE.
