Bitcoin-supported stablecoin project Avalon Labs raises $10 million in Series A funding
Avalon Labs, a leading player in the Bitcoin DeFi space, has secured $10 million in a Series A funding round. The fundraising was led by Framework Ventures, with participation from UXTO Management, Presto Labs, Kenetic Capital, and YZi Labs (formerly Binance Labs).
The funds raised will be used to expand Avalon Labs' decentralized finance (DeFi) ecosystem on Bitcoin. The company's flagship product is the USDa stablecoin, which allows users to collateralize their Bitcoin at a fixed rate of 8%.
Stablecoins, such as USDa, have emerged as one of the leading drivers of crypto adoption, particularly for cross-border payments. The market size of stablecoins skyrocketed to over $212 billion on Monday, according to industry data. While the TVL (Total Value Locked) of Avalon Labs' stablecoin peaked at $530 million last week, it has since retreated to $461 million, as per DeFiLlama data.
Avalon Labs' ecosystem is anchored by USDa and offers various DeFi services like lending, borrowing, derivatives, and trading, all integrated within the broader Bitcoin ecosystem. The company is positioned within the Merlin Chain ecosystem and emphasizes infrastructure support for multi-chain security wallets and DeFi applications around Bitcoin.
The project has gained backing from prominent investors like YZi Labs, reflecting solid venture interest and strategic alignment with major blockchain innovation hubs. Avalon Labs is recognized among past cohorts of YZi Labs' Most Valuable Builder (MVB) accelerator program, indicating continued support for scaling and ecosystem growth initiatives.
The expansion plans of Avalon Labs and related projects are part of YZi Labs' strategy to build a $10 billion global portfolio emphasizing long-term impact and solid fundamentals. While specific roadmap details were not disclosed, the integration of real-world assets (RWA) and AI-driven DeFi protocols on chains like BNB Chain suggests potential synergies for cross-chain expansion and technology advancement.
This fundraising comes at a time when Bitcoin is rapidly expanding into the DeFi sector. Bitcoin is no longer just a store of value in the DeFi sector, but also a key component of various DeFi applications. Avalon Finance, a part of Avalon Labs, currently holds the highest TVL in the protocol with $880 million.
In conclusion, Avalon Labs is actively developing a Bitcoin DeFi ecosystem focused on the USDa stablecoin and related DeFi services like lending and derivatives. The company's expansion is tied to accelerator-driven funding and strategic inclusion in emerging DeFi and AI projects, emphasizing infrastructure development and ecosystem scaling primarily on the Bitcoin and Merlin Chain ecosystems.
The expanded funds will be utilized to develop technology-driven DeFi services on the Bitcoin ecosystem, which include lending, borrowing, derivatives, and trading. This move is expected to attract more investors in the finance and technology sectors.
With the growing interest in stablecoins such as USDa, Avalon Labs plans to advance its infrastructure support for multi-chain security wallets and DeFi applications, aligning with major blockchain innovation hubs in financing and technology.
