Acala, a prominent parachain on Polkadot, has launched a $250 million ecosystem fund to boost the adoption of its stablecoin, aUSD. The fund will support early-stage startups that are creating applications that have strong stablecoin use cases on Kusama or Polkadot parachains.
The fund has already garnered significant attention, with big names such as Arrington Capital, Alameda Research, Digital Currency Group, IOSG, Kraken Ventures, Jump Crypto, Pantera Capital, and several others.
Grants To Early Stage Projects
Acala released a press statement, stating that the fund will be providing early grants to startups in the Polkadot ecosystem that are working in different areas such as Decentralized Finance (DeFi), payments, derivatives, and Decentralized Autonomous Organizations (DAOs) utilizing the aUSD stablecoin.
Chief Growth Officer at Acala, Dan Reecer, stated,
“The fund is meant to support any team building on any Polkadot parachain with a strong aUSD use case,”
Partnership With Other Parachains
Acala also announced that it would be partnering with other Parachains on Polkadot, such as Centrifuge, Astar Network, HydraDX, Efinity, Manta, Moonbeam, Parallel, OriginTrail, and Zeitgeist, on the adoption of the aUSD stablecoin.
Acala’s DeFi offerings revolve around the aUSD stablecoin. The stablecoin can be minted by using collateral tokens on Polkadot such as DOT, ACA, KSM, and KAR, which can then be staked for yield.
The aUSD Stablecoin
The team behind Acala realized that an ecosystem of connected blockchains required a reliable and stable currency to power all economic activity in the ecosystem. The aUSD stablecoin enables users to unlock liquidity from reserve assets like the ACA, DOT, KSM, and KAR tokens. They can also unlock liquidity from cross-chain assets such as ETH, BTC, and parachain tokens. aUSD can be minted by collateralizing the reserve assets, allowing users to earn yield while also maintaining their ownership over the reserve assets. The aUSD stablecoin was launched on 9th February 2022.
At the time, Bette Chen, Acala co-founder, had stated,
“Building the native, decentralized stablecoin of Polkadot and Kusama has been at the heart of Acala’s work for over three years. It is fantastic to see this group of parachains and funds coming together to grow the cross-chain ecosystem with aUSD as a foundational building block.”
Goals Of The Fund
While launching the aUSD ecosystem fund, the team at Acala outlined the goals of the fund, stating that the fund will help teams building in the Kusama and Polkadot ecosystem. The fund will also look to grow Polkadot’s and Kusama’s ecosystem by helping to increase cross-chain activity and also help the growth of the aUSD stablecoin.
Grow Support For Projects
Any project or team accepted into the aUSD ecosystem fund will also receive support from the team at Acala and partners and supporters of the fund. The team will be able to raise capital easily from industry-leading funds. Acala’s engineering team will also support the projects. Projects will also receive aUSD as liquidity into the project, significantly boosting the TVL.
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.