Liquity has raised $6M In Series A funding led by Pantera Capital with follow on investments from Nima Capital, Alameda Research, Greenfield.one, IOSG, AngelDAO, and others. We also received backing from an amazing group of angels including Bo Shen, Meltem Demirors, David Hoffmann, Calvin Liu, George Lambeth, and many more. Lastly, we’d like to thank and recognize Tomahawk.VC, 1kx, and Lemniscap for their continued support during this round.
The money raised in the funding will be further used in “Liquity’s mission of improving access to on-chain borrowing, removing interest rates, and minimizing governance in DeFi.” The funding round propels the team to expand and opt for opportunities for the enhancement of the Liquity ecosystem.
Robert Lauko further explains that:
Liquity is a decentralized borrowing protocol that offers interest-free liquidity against ETH as collateral. Loans are paid out in LUSD, a USD pegged stablecoin, and need to maintain a minimum collateral ratio of only 110%.
It aims to offer uncountable benefits to borrowers “by utilizing a novel liquidation mechanism and leveraging an algorithmic monetary policy”. The protocol “provides interest-free borrowing on the Ethereum network, plans to expand its ecosystem and hire more resources following the latest funding round.” The protocol will go live on the Ethereum mainnet on April 5.
Speaking on the biggest issues in the DeFi lending market, Lauko says that “varying interest rates and fees make DeFi lending pretty unpredictable,” which means “people are paying a high premium on fixed-interest products.”
He further wrote:
Liquity aims to solve this problem by replacing variable interest rates with a one time borrowing fee while simultaneously improving capital efficiency through a 110% minimum collateralization ratio.