Vega, a decentralized trading protocol for derivatives, announced today that it has completed a $ 5 million investment with investments from Arrington Capital, Cumberland DRW and Coinbase Ventures
The rounds, led by Arrington Capital and Cumberland DRW, support Vegas’ mission to democratize the markets by allowing anyone to create and launch a derivatives market while addressing some of the challenges that plague decentralized systems and have prevented their widespread adoption.
By eliminating central gatekeepers and decentralizing governance, Vega enables immediate settlement (<1 sec), removes the conflict of interest from markets, lowers fees and enables the throughput required to trade high volume derivatives (up to 10,000 TPS).
“By enabling anyone to create and open a derivatives market, we want to provide people with the tools they need to hedge against risks that are unique to their region, profession, or situation. Derivatives trading has long been a pillar of traditional finance, but DeFi has so far not been able to achieve the capital efficiency and throughput necessary to make decentralized derivatives trading profitable. We are very grateful to everyone who contributed to our funding rounds as this increase is critical to keeping Vega focused on the mainnet launch as the first institutional grade derivatives trading protocol. “
– Barney Mannerings, founder of Vega
The protocol brings together over two years of engineering effort and original academic research into on-chain derivatives. In addition to building a tailor-made blockchain that focuses on high-performance and scalable trading, Vega is presenting a range of innovations in areas such as on-chain anti-frontrunning, liquidity incentives, active and passive market making, CLOB and AMM dichotomies as well as on- Chain protection switch and decentralized risk management.
Vega launched its testnet in the second quarter of 2020 and has performed a number of iterations since then. At the same time, the team launched a market and liquidity program in June 2020, with eight founding members joining as the earliest institutional adopters of the protocol. With the upcoming release of the Flamenco Tavern, liquidity mining will start in TestNet, which is characterized by a unique mix of active and passive liquidity provision.
Vega is currently on its way to its mainnet release with plans to enable self-managed cross-chain collateral and build a trustworthy bridge into the Ethereum ecosystem. Future deployments will expand Vega’s scope to other major blockchains such as Bitcoin, Polkadot, and Cosmos, and lead to Vegas’ overarching mission to democratize derivatives infrastructure.
Other raise participants are ParaFi Capital, Signum Capital, CMT Digital, CMS Holdings, Three Commas, GSR, SevenX Ventures and ZeePrime Capital. The DeFi Alliance joined Aave CEO & founder Stani Kulechov, Enzyme Finance founder Mona El Isa, co-founder and CEO of Terraform Labs (TFL) Do Kwon and CEO and co-founder of Kyber Network Loi Luu as an investor. This round follows Vegas’ opening round, led by Pantera Capital, which closed in October 2019.