DeFiance Capital has reportedly raised $100 million for its liquidity token fund.
The Block reported that the cryptocurrency investment firm completed the first closing of the new fund, citing “two sources with direct knowledge of the matter.”
The company confirmed the news by retweeting the news report on its official Twitter account, with founder and cryptocurrency investor Arthur Cheong also writing:
“Cryptocurrencies typically peak in unbridled optimism and bottom in desperate pessimism. There’s no better time to invest.”
The company raised “eight figure” funding, sources told the news outlet, adding that it had initially raised less than $50 million.
As for the investors who decided to back the fund, they are reportedly a “good mix,” including cryptocurrency funds, family offices, and certain existing investors.
0xzx.com reached out to DeFiance for comment.
What is DeFiance Capital?
Founded in 2020, DeFiance Capital is a Web3 and crypto-focused investment firm that claims to have “many successful investments in DeFi, Web3 games, and infrastructure.”
Projects it supports include Aave, dYdX, Lido, Axie Infinity, Layer Zero, Offchain Labs (Arbitrum) and more.
However, it was hit hard by the bankruptcy of cryptocurrency hedge fund Three Arrows Capital (3AC) and quickly distanced itself, claiming to be an independent company operating independently.
As reported last July, DeFiance Capital said the liquidation of its rival fund 3AC was “significantly influenced” and “biased.” It also claimed CEO Cheong had “no knowledge” of Three Arrows’ financial statements or conditions.
Not long after, in September, news broke that the company was raising $100 million for a “liquidity venture fund,” and by then it had raised nearly half of its goal.
“The best opportunities are already flowing”
For some time now, there has been more and more talk about liquidity tokens and liquidity token funds both within and outside the cryptocurrency space.
Pantera Capital launched its own Liquid Token Fund in 2017, describing it as “a multi-strategy vehicle that typically invests in 10-20 liquid tokens at any point in time.” It added that the fund is “mainly funded by Driven by independent strategies”, focusing on DeFi and related assets.
According to Nate Hindman, head of growth at on-chain liquidity protocol Bancor, “Liquid Token is a smart contract that acts as an automated market maker by regulating the buying and selling of tokens along a predetermined price curve, using a single collateralized Pin Mining Pool to support it.”
Therefore, Hindman argues that the higher the reserve ratio of a liquidity token, the better its price stability, adding,
“This new form of automated liquidity has the potential to change the way users tokenize Crypto projects, communities, ecosystems, and more.”
Many applaud DeFiance Capital’s latest move, such as Adam Cochran, partner at Cinneamhain Ventures and contributor to several DeFi projects,
Congratulations – loved seeing this.
It’s been advocating for some time that some of the best opportunities in the space have flowed, not crappy SAFTs.
– Adam Cochran (adamscochran.eth) (@adamscochran) March 13, 2023
Meanwhile, The Block claims to have obtained a draft of an article written by DeFiance indicating that the fund aims to acquire tokens that trade below VC valuations.
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Source of information: Compiled from CRYPTONEWS by 0x Information.Copyright belongs to the author, without permission, may not be reproduced