- Coinbase Ventures, Paradigm and IOSG have invested $12 million into the Synthetix DeFi platform
- The VC firms made the investment by purchasing SNX tokens from Synthetix’s treasury
- SNX recently recorded an all-time high at $28.6
3 venture capital firms invest $12 million into Synthetix
Ethereum-based DeFi platform Synthetix has raised $12 million from venture capital firms Coinbase Ventures, Paradigm and IOSG. The three VC firms made their investment by buying SNX tokens from the Synthetix treasury.
Synthetix allows enables the creation of synthetic assets, which are derivatives that track the price of other assets. Interfaces such as synthetix.exchange allow users to interact with the Synthetix protocol and gain exposure to a variety of assets directly on the Ethereum blockchain – this can either be crypto assets like Bitcoin and Cardano, precious metals like gold and silver, commodities and even indices like sDEFI, which track a basket of DeFi-related tokens.
Synthetix is governed through a decentralized autonomous organization (DAO) model, which was established following the dissolution of the Synthetix Foundation, the organization that kickstarted the project, in 2020.
Paradigm partner investment Arjun Balaji commented on the company’s investment:
“We’re excited about supporting the synthetixDAO as it builds the leading synthetic asset platform. Synthetix has one of the best communities in crypto and we’re glad to be a part of it.”
Per a CoinTelegraph report, the three VC firms are also assisting the Synthetix project in different ways. Paradigm has been providing ideas for Synthetix’s planned v3 release, and is also helping the project with recruitment. Coinbase Ventures has been assisting Synthetix with connectivity, while IOSG is involved with pushing Synthetix adoption in the Chinese market
When it comes to DeFi projects, it’s not too uncommon to see VC firms investing by purchasing tokens. For example, Andreessen Horowitz’s a16z crypto fund spent $15 million to purchase 6% of the supply of MakerDAO’s MKR token in September of 2018.
Despite the news, SNX is currently going through a dip, alongside the rest of the cryptocurrency market. The token is currently trading at $24.2 after a 5.6% decline in the last 24 hours. Yesterday, the token printed a new all-time high at around $28.6. With a market capitalization of $2.77 billion, SNX is currently the 30th largest crypto asset on the market.
Source link: https://coincodex.com/article/10602/betting-on-defi-3-venture-capital-firms-buy-12-million-worth-of-snx-from-synthetix-treasure/