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OpenTrade, a DeFi protocol platform that offers on-chain financial products to Web3 treasuries and businesses, has secured $1.5 million in a funding round.
OpenTrade Raises $1.5 Million in Funding Round Led by Sino Global Capital
Sino Global Capital, a crypto-native venture capital firm, led the funding round in participation with Circle Ventures, Kronos Research, Kyber Ventures, Polygon Ventures, and Outlier Ventures. The funds raised will help OpenTrade expand its operations in preparation for its upcoming launch in the second half of this year.
OpenTrade plans to launch liquidity pools for various financial products, such as U.S. Treasury bills, investment-grade commercial paper, and investment-grade supply chain financing.
These pools will provide tokenized access to traditional finance products, such as short-term U.S. debt obligations backed by the government. The growing popularity of this approach stems from its ability to allow investors to access the crypto market while managing volatility in a prolonged bear market.
The company is based in both London and Palo Alto, and has established its operations on Circle’s DeFi and payments infrastructure. This unique platform operates on both the Polygon and Ethereum blockchain networks and leverages a vast network of financial institutions and business-to-business (B2B) networks to create on-chain liquidity pools.
These pools are designed with specific investment criteria, underlying assets, and target yields, making them highly customizable and appealing to a diverse range of investors.
To ensure the security and stability of each liquidity pool, the assets that back each pool are held in a bankruptcy remote structure by a regulated custodian. This custodian carefully safeguards the assets in segregated accounts, ensuring that they are separate from the company’s assets and minimizing the risk of financial loss.
This effective risk mitigation strategy underscores OpenTrade’s commitment to providing a secure and reliable investment platform for its users.
Users who are interested in depositing funds into OpenTrade’s liquidity pools have the option of using their digital wallets to deposit either USDC stablecoins or the euro coin (EUROC). Once the deposit has been made, users will receive an ERC-20 token in return, which represents a proportional share in the net asset value (NAV) of the liquidity pool, as well as the underlying assets.
If a user decides to withdraw their funds, they can easily do so by redeeming their liquidity pool tokens. This redemption process will provide users with an equivalent amount of USDC or EUROC, which will include a proportional share of the principal and accrued interest that has accumulated during the time that their funds were invested in the liquidity pool.
By offering this straightforward deposit and withdrawal process, OpenTrade has made it easier for investors to access and manage their investments in the liquidity pools. Moreover, the use of digital assets such as USDC and EUROC provides added security and transparency for investors, ensuring a seamless and trustworthy experience for all involved parties.
The Team Behind Opentrade
OpenTrade’s leadership team boasts a wealth of experience and expertise in the fields of blockchain technology, finance, and asset management. At the helm of the company is CEO Dave Sutter, who is joined by Chief Commercial Officer Jeff Handler, both of whom have an impressive track record in the industry.
Notably, Sutter and Handler previously served at Centre, a consortium co-founded by Circle and Coinbase to govern the USDC stablecoin. Their experience in the development and management of digital assets has been instrumental in OpenTrade’s success.
Another key member of the team is Michele Bisceglia, who brings expertise in advisory and asset management. Prior to joining OpenTrade, Bisceglia was a partner at a leading asset management firm, AgFe.
Bisceglia and adviser Steve White launched Five Sigma as part of OpenTrade’s formation, a dedicated structured finance and investment advisory firm that was spun out of AGFE to manage OpenTrade’s off-chain operations. Currently, Five Sigma has over $700 million in assets under management.
The collective experience and knowledge of OpenTrade’s leadership team, combined with the support of Five Sigma, has enabled the company to establish itself as a leading player in the DeFi space. Their strategic vision and commitment to innovation have positioned OpenTrade for
OpenTrade’s funding round demonstrates the growing interest in DeFi protocols that enable the tokenization of traditional finance products. This will provide investors with greater flexibility, reduced transaction costs, and the potential for increased returns, all while managing risk in a highly volatile market.
OpenTrade’s unique approach to on-chain liquidity pools offers investors the opportunity to diversify their portfolios further and access traditional finance products in a new way.
Crypto VC Funding Hits 2-Year Low- Galaxy Research Report
A recently published report by Galaxy Research, the research branch of Galaxy Digital, reveals a decline in venture capital (VC) funding for crypto startups and protocols. The report, which was published on April 11, shows that VC funds invested a total of $2.4 billion in Q1 of 2023.
While this amount may seem significant, it represents the lowest VC investment of any quarter since the last quarter of 2020 and is 80% less than the investment amount in Q1 of 2022. In Q1 of 2022, VC investors injected almost $13 billion into the crypto industry, which remains the highest amount invested in any quarter ever.
The decline in VC funding can be attributed to various factors, including the falling crypto prices and the recent dramatic collapses of significant crypto funds. Additionally, the author of the report, Alex Thorn, suggests that the rising cost of capital due to interest rates has also played a role in reducing the size of investments.
Despite the decrease in investment size, the number of crypto investment deals has increased by 19%. Q1 of 2023 recorded 439 deals, which is 73 more than the 366 deals registered in the last quarter of 2022. However, the report also indicates that the median deal size has dropped during the same period.
Overall, while the decline in VC funding for crypto startups and protocols may seem concerning, the increased number of investment deals is a positive sign for the industry. It remains to be seen how the industry will adapt to the changing landscape of VC funding and continue to innovate in the face of these challenges.
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