Acala and Karura receive backing from Coinbase Ventures

Acala and Karura receive backing from Coinbase Ventures

The two projects, a decentralized financial hub and a stablecoin platform, have recently announced that they have received support from Coinbase Ventures, the official investments arm of Coinbase.

As a decentralized finance (DeFi) platform, Acala’s platform helps developers build DeFi apps with a focus on financial primitives. Acala’s network provides a multi-collateralized stablecoin that’s backed by cross-chain assets such as Bitcoin, a trustless staking derivative, and a full-function decentralized exchange (DEX). This suite of services helps players in the booming DeFi industry scale their projects and open their tokens to liquidity and automated financial functions (automated money market, or AMM).

Launched in 2018, Coinbase Ventures has helped establish projects in the open finance space. The firm provides financing to early stage startups on the crypto ecosystem in the hopes of bolstering and accelerating the development of multiple approaches to developing the industry forward. With this latest move to include Acala into its portfolio of supported projects, the firm hopes to help position Acala and Karura at the forefront of crypto ecosystem innovation, creating products for the benefit of all crypto users. Notable projects backed by the firm include Etherscan, Compound, OpenSea, and BlockFi, among others. 

The support from Coinbase Ventures also includes backing for Kusama’s Karura, a scalable, EVM-compatible hub optimized for DeFi apps offering a 360 degree service with the same suite of features as Acala (liquid KSM for staking derivative and kUSD as backing asset), propelled with micro-level gas fees that can be transacted with and Ethereum-compatible token.

While Acala is aligned with Polkadot, and Kusama is built on essentially the same codebase as Polkadot, both projects are independent of Polkadot. Kusama is unique because it features faster governance parameters and higher risk tolerance. Kusama is currently undergoing development to create a parallel bridge to the Polkadot network, and when this is completed, both Karura (for Kusama) and Acala (for Polkadot) will become fully interoperable.

This investment from Coinbase Ventures will bring Acala and Karura to full launch, with a planned multi-fold approach that involves community support. The Acala development team will need to secure a parachain slot auction on Kusama to launch Karura to mainnet. They will then need to do the same and hold out with a parachain slot auction on Polkadot. Both parachain slot auctions are set to be crowdloaned directly by the Karura and Acala communities, hence distributing the number of backers for both networks.

CryptoDaily has recently covered news on two other parachain candidates for the Polkadot and Kusama (PureStake’s Moonbeam and Moonriver networks), which garnered a $6 million raise. The precise amount of investment by Coinbase Ventures for Acala and Karura have not been disclosed as of press time.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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