Decentralized lending protocol Goldfinch is facing fallout from a distressed $20 million cryptocurrency loan as the borrower's high-risk real estate and digital asset investments unravel.

RWA lending protocol Goldfinch faces $7M bad loan.

Tugende, a venture-backed lender based in Uganda, and Warbler Labs, the company building Goldfinch, a decentralized credit protocol, have agreed on a loan restructuring plan that may lead to the recovery of the $5 million loan that the East African motorcycle taxi financing company defaulted months ago.Warbler Labs arrived at a restructuring “agreement in principle” (an arrangement that lays ground for a contract) with Tugende and its backers including a strategic investor, according to an investor update.The terms of the agreement were not made public. Tugende co-founder and CEO Michael Wilkerson, declined to offer details of the restructuring plan promising more information in the coming weeks. “There is a larger transaction and a strategic investor coming together,” he said.The planned restructuring comes after Tugende defaulted on the $5 million it took from Goldfinch protocol in October 2021 for its Kenya operations. Tugende was up-to-date with the $53,400 monthly interest until May this year, five months before the principal amount matured. It defaulted from June causing panic in the Goldfinch community.Goldfinch is a a16z-backed decentralized lending protocol that lets entities in emerging markets access crypto loans without having any crypto holdings in the first place. This is unlike most DeFi platforms that require borrowers to stake crypto assets that exceed the value of the loan they want