Coinbase Ventures backing DeFi in the Polkadot ecosystem
The leading United States digital currency exchange is backing Acala, Polkadot’s all-in-one DeFi hub.
Coinbase Ventures, the investment arm of the San Francisco-based digital currency exchange, has thrown its weight behind a layer-one blockchain designed to bring full-service DeFi to the Polkadot ecosystem.
The investments are focused on Acala, the Ethereum Virtual Machine-compatible blockchain that is building a host of DeFi capabilities on Polkadot, as well as Karura, which is building a DeFi ecosystem on Kusama. Acala has already built four core products for the Polkadot ecosystem: Liquid DOT staking, a stablecoin, an automated market maker decentralized exchange and a sovereign wealth fund.
The amounts allocated to Acala and Karura were not disclosed.
According to Dan Reecer, Acala’s VP of growth, both Acala and Karura are launch-ready, which means the aforementioned applications will be available to users on day one. He explains the launch process as follows:
“The Acala team’s path to launch is multi-fold and incorporates the support of its community. The team will first need to win a parachain slot auction on Kusama to launch Karura, then will need to win a parachain slot auction on Polkadot to gain a slot for Acala to launch.”
Polkadot and Kusama are both nearing the auction phase for their first parachain slots.
Receiving backing from Coinbase Ventures is viewed as a significant achievement, given the array of successful projects the VC has supported in the past. Some of Coinbase Ventures’ most prominent investments include BlockFi, Compound, and Etherscan.
Polkadot and Kusama have attracted considerable attention from retail investors over the past year. DOT, the native cryptocurrency of the Polkadot ecosystem, is a top-ten project with a total market capitalization of $35 billion. Kusama, meanwhile, is ranked 32nd by market cap with a total value of $3.9 billion.