Element Finance, a decentralized finance (DeFi) lending protocol, has closed a $32 million Series A round at a valuation of US$320 million.
The funding round was led by Polychain Capital with other new investors including P2P Validator, Republic, Rarestone, Ethereal Ventures, Advanced Blockchain, and their limited partners part.
Existing investors like Scalar Capital, Andreessen Horowitz, A_Capital0, and Placeholder, as well as several DeFi builders also participated in the round.
Element Finance plans to hire more people across all areas with this new investment.
Element Finance launched its protocol on the Ethereum mainnet on June 30, and despite being relatively new, has been quite successful as it is currently the equivalent of $180 million in total value-locked.
It has been building a new DeFi (decentralized finance) protocol on top of the Ethereum blockchain, and lets users earn predictable returns on their investments as a result of fixed rates over a predetermined period of time.
Some of its users can opt for higher returns in order to guarantee fixed rates. These users contribute to liquidity pools with varying interests, but this means they won’t be able to predict their returns at the end of the year.
Currently, users can participate in 10 fixed-rate pools, and they can contribute with stablecoins like USDC, DAI, and other popular (wrapped) cryptos like wBTC, or with sophisticated derivative assets like steCRV, which is a token that represents a stake in the CurveETH/stETH liquidity pool.
Element Finance also wants to convince fund managers to invest in an Element pool in addition to the great product it offers individual investors. It has launched a treasury management initiative to persuade other DeFi protocol makers, funds and institutions to allocate a portion of their capital to Element Finance.
It also plans to introduce a governance system with different voting vaults and different incentives.
Element Finance has been used by 9,000 users so far.
Don’t miss important articles during the week. Subscribe to blockbuild weekly digest for updates.