Avantis Labs, a decentralized finance (DeFi) derivatives ecosystem, has successfully raised $4 million in a seed funding round led by Pantera Capital. Other notable investors, including Founders Fund, Galaxy, Coinbase’s Base Ecosystem Fund, and Modular Capital, also participated in the round. The funds will be used to further develop Avantis’ flagship product, a perpetual-trading and market-making protocol called Avantis.
Key Takeaway
Avantis Labs, a DeFi derivatives ecosystem, has raised $4 million in a seed funding round led by Pantera Capital. The funds will be used to develop Avantis, a perpetual-trading and market-making protocol. Avantis aims to cater to the needs of sophisticated liquidity providers by enabling on-chain trading of real-world assets without the need for tokenization. The platform plans to launch its mainnet by 2024 and expand its offerings beyond perpetuals to include options trading.
Leveraging Sophistication: Catering to Complex LPs
Avantis aims to provide a platform that caters to the needs of sophisticated liquidity providers (LPs) in the DeFi space. Unlike average traders, these LPs are highly complex and sophisticated individuals who are actively involved in on-chain risk management and yield hunting. With their individual risk profiles in mind, Avantis aims to build a protocol that meets their specific requirements.
Unlocking the Potential of Perpetuals
Perpetuals are a type of derivative contract that allows traders to speculate on the price of an asset without actually owning it. Unlike futures contracts, perpetuals do not have an expiration date and can be held indefinitely. While many DeFi perpetual protocols primarily focus on trading cryptocurrencies, Avantis plans to expand its offerings to include traditional assets like forex and commodities. The goal is to enable on-chain hedging and trading without the need for tokenization, which can be a slow and expensive process.
Real World Assets in the DeFi World
There has been a growing demand within the crypto community for more real world assets (RWAs) to be linked to the DeFi world and leveraged trading. However, many RWAs available on-chain are restricted to accredited institutions and not accessible to everyday traders. Avantis aims to bridge this gap by providing access to forex and commodities on-chain, allowing traders to hedge and trade these assets without the need for intermediaries.
The Uniswap V3 Moment for LPs
Avantis refers to its approach as the “Uniswap V3 moment” for LPs of these leverage protocols. By leveraging oracles from Pyth and Chainlink, Avantis’ trading engine aims to provide better prices across centralized and decentralized financial markets. The platform is being developed on Optimism Superchain and uses USDC stablecoins as collateral for trades on its protocol.
Expanding Access and Opportunities
Avantis plans to launch its mainnet by the first quarter of 2024 and aims to provide institutional and retail investors with the ability to trade crypto and RWAs with up to 100x leverage on its decentralized exchange. The platform also aims to offer better DeFi derivative-trading and market-making infrastructure, as well as capital-efficient composability that is scalable. Avantis’ vision extends beyond perpetual trading, with plans to develop an options engine in the near future.
