Key Points
- Curve Finance’s founder, Michael Egorov, has launched Yield Basis, a project aimed at addressing impermanent loss in decentralized finance.
- The project has raised $5 million in funding at a token valuation of $50 million and plans to help tokenized Bitcoin and Ether holders earn yield while lowering impermanent loss risks.
Michael Egorov, the creator of Curve Finance, has unveiled a new initiative named Yield Basis. This project is intended to address the issue of impermanent loss in the realm of decentralized finance.
The Block reported that the initiative had successfully raised $5 million in funding, with the valuation of its tokens estimated at $50 million. The primary goal of Yield Basis is to provide a remedy for holders of tokenized Bitcoin and Ether, allowing them to generate yield from market-making activities while simultaneously minimizing the risks associated with impermanent loss.
Funding and Token Distribution
The fundraising round, which was oversubscribed by 15 times, managed to raise $5 million in a mere two weeks. The funds were collected at a valuation of $50 million, with investors purchasing 10% of the token supply, equivalent to 100 million YB tokens. These tokens are set to follow a six-month cliff, followed by two years of linear vesting.
Egorov, expressing his views on the defi ecosystem, previously stated, “I strongly disagree that innovation is not happening in defi. It does! The market just does not recognize it enough […]”.
Innovative Approach to Liquidity Provision
Egorov confirmed to The Block the details of the fundraising and the project. He explained that Yield Basis is currently in the “test-in-production” phase, with audits and testing in progress. The full-scale launch will take some time, but the platform is anticipated to reduce impermanent loss through innovative changes to automated market makers.
The project’s token distribution plan sets aside 30% of the total supply for community incentives, 25% for the team, with the rest allocated for development reserves and collaborations. Egorov suggested that the Curve technology licensing could potentially be utilized to support liquidity pools, particularly for crvUSD, Curve Finance’s stablecoin.
It was previously reported that the TON Foundation had partnered with Curve Finance to facilitate yield-bearing token exchanges and optimize swap processes before this launch.
