Maker Foundation Sells $27.5 million MKR to Dragonfly Capital and Paradigm, expanding their influence in Asia while driving DeFi adoption.
The Maker Foundation, the group behind the decentralized crypto platform MakerDAO, announced today that venture capital funds Dragonfly Capital Partners and Paradigm have acquired $27.5 million worth of MKR. This is approximately 5.5% of the total MKR supply.
As MKR token holders, both investment funds will actively participate in the decentralized governance of the Maker Protocol. This will also support Maker’s efforts to increase adoption in Asia of Dai, its decentralized stablecoin built on the Ethereum blockchain. In addition, Maker will have direct access to both Dragonfly’s and Paradigm’s expertise in the Asian market, increasing the presence of decentralized finance (DeFi) throughout the region.
Managing partner of Dragonfly Capital, Alexander Pack, told Cointelegraph:
“[MakerDAO] have created a leading DeFi product in crypto, as Dai has become a primary stablecoin for decentralized finance. However, most MKR holders are American venture capitalists. Even though crypto is mainly being used in Asia, MakerDAO needs help expanding their presence in that region.”
Both Dragonfly Capital and Paradigm are global crypto venture funds with a strong presence in the United States and Asia, making them potentially important players to help MakerDAO build out their business and influence.
The rise of DeFi in Asia
While having prominent investors in Asia with a stake in MKR will help Maker build influence in the region, CEO of the Maker Foundation, Rune Christensen, told Cointelegraph that Asia is key for the growth of DeFi globally, saying, “DeFi has come a long way and Asia is a place where it will grow, just as it has helped with Bitcoin and Ethereum adoption and influence.”
According to Christensen, DeFi is the cutting edge of innovation for the crypto industry, as its value creation exists entirely on the blockchain.
“DeFi is a new generation of products that are entirely transparent, where users can see exact cash flows while achieving greater levels of trust and security that can be audited in real time. DeFi also incorporates the global nature of blockchain and its advantages, making these more efficient systems with lower fees and higher yields,” said Christensen.
And although MakerDAO is just now expanding DeFi to Asia, there have already been significant strides made to drive DeFi adoption in general.
For example, on Nov. 18, MakerDAO launched Multi-Collateral Dai (MCD), which allows new collateral assets to be approved by Maker Governance to back its Dai stablecoin. MCD has since allowed for the new Dai Savings Rate (DSR) feature, letting Dai holders earn savings automatically by locking their Dai into the DSR contract.
While the Dai Savings Rate is an important aspect of the Maker Protocol, Christensen also pointed out that it has led to the integration of the Dai Savings Rate with crypto exchange, OKEx. According to Christensen, this will help drive adoption of DeFi even further, as users of the OKEx platform will be able to directly deposit Dai and stake it in the DSR without leaving the OKEx platform.
“On Dec. 23 OKEx users will be able to take advantage of the DSR. This is the first major roll out of a DeFi product in Asia, which ties nicely into the launch of our multi-collateral Dai,” said Christensen.
Moreover, Christensen pointed out that this shows there is a need and interest to develop DeFin Asia.
“The next step is to use OKEx and this funding round as an example that DeFi is ready and can be used in Asia. We then plan to focus on other areas of growth in regions like South America where Dai is already the leading stablecoin,” said Christensen.
