Pantera Capital Leads $6 Million Series A Round for Liquity Protocol

Liquity Protocol, a lending platform, raised $6 million in a Series A round led by Pantera Capital.

Participants in the round also included Nima Capital, Alameda Research, Greenfield.one, IOSG, AngelDAO, Meltem Demirors and other investors.

The funds will be used to expand the team, improve access to on-chain loans, eliminate interest rates, and minimise protocol governance.

Liquity is slated to launch on the Ethereum mainnet on April 5. Before that, the team spent about a year and a half on modelling and auditing.

? We’re excited to announce that Liquity will launch on April 5!

We’ve published a blog post detailing what to expect on launch day along with more info about $LQTY distribution and rewards: https://t.co/MuDiYWvDML

— Liquity (@LiquityProtocol) March 24, 2021

Based in the Swiss town of Zug, Liquity positions itself as a decentralised lending protocol that offers interest-free liquidity collateralised by Ethereum. It uses an algorithmic monetary policy.

Loans are issued in the US-dollar-pegged stablecoin LUSD. Borrowers must maintain a minimum collateralisation ratio of 110%. The corresponding figure for the popular lending platform Maker is 150%.

Liquity founder Robert Lauko, in an interview with Cointelegraph, said that users pay a high premium for fixed-rate lending products to borrow loans with a low collateralisation ratio. This happens because floating interest rates and fees increase the unpredictability of using lending platforms, he added.

By the end of March, the total value locked in DeFi protocols reached $78.7 billion. Lending platforms occupied second, third and fifth places in the ranking.

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