Earlier on Monday, Parallel Finance announced that it had raised $22 million in a Series A funding round.
The investing round for the Polkadot-based DeFi protocol was led by Polychain Capital, alongside Alameda Research, Blockchain Capital, Blockchain ventures, Slow ventures, Lightspeed venture Partners, and CMT Digital, among others.
What is Parallel Finance?
Parallel Finance offers margin staking, auction loans, staking derivatives and an automated market maker (AMM) curve to enable greater yield for Polkadot holders.
The protocol also boasts of features such as liquidity mining and leverage staking. Liquidity mining enables users to stake their Polkadot tokens to receive Parallel’s native PAR token, whereas leverage staking allows users to borrow against their collateral to increase yield.
The Series A round was an equity round — meaning that investors are given equity, or stock, in Parallel. This is Parallel Finance’s second ever funding round, as the project raised $2 million earlier in June.
It’s important to note that the protocol has only been online for 5 months, with its debut last March. The project still remains in relative infancy, currently in testnet on both Polkadot and Kusama. Parallel is planning to launch its mainnet in the last fiscal quarter of 2021, according to Co-Founder Yubo Ruan.
As the DeFi space continues to grow at an unprecedented rate, Parallel is looking to expand its operations by hiring more developers and engineers, Ruan said. There are currently 3,000 users of the protocol, but Ruan said he was hopeful of the protocol reaching over 50,000 users within the next year.
Protocol Set to Participate in Polkadot Crowd Auctions
Parallel is also looking to join Polkadot and Kusama crowd auctions. Earlier last week, Parallel announced that it had launched its crowd loan campaign to gain a spot for a Kusama parachain slot, with Heiko Finance acting as the parachain to launch on Kusama.
We intend for Parallel-Heiko to be a top-tier DeFi parachain, and liquidity mining is critical for this reason. Liquidity mining can incentivize higher capital in-flows and thus higher TVL for our parachain, which is a critical KPI.
— Parallel Finance (@ParallelFi) August 31, 2021
With only 100 parachain slots being available on the Polkadot network, projects need to win a crowd loan in order to operate on the mainnet and connect to the DOT network.
As for future funding, Ruan said Parallel Finance will raise more funds once the project has more TVL (total value locked).
Featured image from UnSplash