Venture capital money is flowing into decentralized finance (DeFi) projects faster than ever and the latest to close a successful funding round is Benqi Finance.
Decentralized non-custodial liquidity market protocol Benqi Finance stated that it raised a total of $6 million in a strategic funding round.
Participants included the usual names in venture capital and DeFi. These include Arrington XRP Capital, Dragonfly Capital, Ascensive Assets, Mechanism Capital, TRGC, Woodstock Fund, and Spartan Group.
The protocol stated that with this strategic investment:
“BENQI will leverage key industry leaders to help navigate the protocol through its initial bootstrapping phase and cross-chain integrations with key projects to help accelerate DeFi activity on Avalanche.”
Liquidity markets on Avalanche
The protocol, announced in late March, has a vision of bridging DeFi and institutional networks. It hopes to achieve this by launching algorithmic liquidity markets while using the high throughput Avalanche blockchain.
As with most similar DeFi protocols, it cited the drawbacks of Ethereum as the primary reason it has chosen Avalanche. However, aside from the choice of the blockchain network, there isn’t much separating Benqi from other liquidity-based DeFi protocols.
There are few technical details on what the protocol is actually trying to achieve. However, the ability to lend, borrow, and earn interest with crypto assets still appears to be the main focus.
According to its introductory blog post:
“With a focus on ease-of-use and low fees, the BENQI protocol will enable the birth of a new generation of open financial applications, further democratizing access to DeFi for the masses.”
Avalanche is the key point here because it claims to be able to process over 4,500 transactions per second and instantly confirm transactions. A number of AMMs have looked towards Avalanche such as SushiSwap which ported to the platform on March 16.
The announcement also added that there will be a BENQI public sale on April 28. It will be held on Tokensoft and accompanied by a mainnet launch in May.
AVAX price update
The native token for Avalanche has jumped over 13% on the day to top $40 according to CoinGecko. AVAX has been on a roll over the past week making 32%. However, it has yet to top its Feb. 11 all-time high of $55.
There are 128.5 million AVAX tokens in circulation giving it a market cap of $5 billion.