What is Happening
Aurigami, a lending protocol on Aurora has raised a total of $12M via private and public sales. Over $9.5M of the total funding came from private investors. The world's leading venture capital firms, such as Dragonfly Capital and Polychain Capital, were the joint round leaders. Mechanism Capital, Amber Group, Coinbase Ventures, Jump Crypto, Alameda Research, Lemniscap, and others are just some of the other funds that have joined.
Alex Svanevik of Nansen, Julian Koh of Ribbon, Bobby Ong and TM Lee of CoinGecko, Alex Svanevik of Etherscan, Matthew Tan of Etherscan, and Santiago R. Santos were among the other renowned angel investors that participated.
What is Aurigami
Users are able to lend, borrow, and earn interest on digital assets with the use of the Aurigami protocol. Borrowers are able to borrow in an over-collateralized form because of the liquidity provided by depositors, who do so intending to earn a passive return. To offer a native DeFi solution for vested tokens, Aurigami has developed the notion of "Liquid Locked Tokens."
The Rise of Lending Protocols in 2021 - The Rise of DeFi Lending
Lending protocols are major participants in the DeFi area, which has developed into a multibillion-dollar business delivering multiple decentralized services to customers inside the bitcoin ecosystem and beyond.
The lending platforms or protocols enable the use of DeFi as a funding mechanism. These sites provide cryptocurrency loans in a trustless manner by letting users "stake" their coins on the DeFi lending sites.
A lender may make money off a loan made on the DeFi platform if and when the borrower repays the loan. With no middlemen involved, the whole financing procedure may go smoothly.
To lend their coins, holders deposit them into a pool managed by a smart contract. Other users may then borrow the coins after transferring them to a smart contract.
After that, the tokens (often the native token of the platform) are immediately distributed to the lender through the smart contract. In addition to the assets initially supplied to the smart contract, the tokens may be redeemed at a later time.
Loans made using native tokens are almost 100% collateralized. Users who seek to borrow money will thus be required to submit a guarantee. However, in the DeFi environment, the guarantee is in the form of cryptocurrency, which is more valuable than the loan itself, in contrast to the centralized banking system.
The borrower might sell their assets to get the money. Thus, the proposal seems silly on paper. But there are a lot of good arguments to support taking out a loan from DeFi. Users may need access to cash to cover emergency needs, but they don't plan on selling their assets since they anticipate future appreciation in value.
Additionally, users may postpone or completely avoid paying capital gains taxes on their cryptocurrency holdings by borrowing funds using DeFi protocols. Individuals may enhance the leverage on certain trading positions using monies borrowed through the DeFi protocols.
Understanding How Aurigami is Bringing Lending Platform to Aurora Ecosystem
Aurigami is a crypto asset lending platform that allows users to provide crypto assets and borrow crypto assets to achieve leverage. Aurigami, in contrast to other protocols, focuses a strong emphasis on gamification. Due to its innovative "Locked Liquid Tokens" (LLT) system, the project may draw liquidity without triggering immediate selling pressure. The PLY long-term token, or PULP, is a claim on PLY in the future.
Since the implied discount of PULP over PLY, Aurigami utilizes both tokens to distribute the proceeds of its liquidity mining, dampening the immediate selling pressure. It is optimum, from a game-theoretic standpoint, for long-term holders to purchase PULP from farmers seeking a quick return on their investment.
The $12 million in funding provides Aurigami with a substantial war chest and runway to continue building the platform, including expanding on the LLT idea and accelerating Aurora ecosystem expansion via initiatives like boosting the use of NEAR's USN stablecoin.
Despite the crypto winter, Aurigami's co-founder, Lucas Huang, is pleased with the $12 million raised thus far. We're here to provide Aurora users with LLTs and gamified DeFi thanks to the backing of "world-class investors" and "great communities" that participated in our public auction.
Final Thoughts on Aurigami $12 Million Warchest
Aurigami funding to grow the lending market on Aurora is a positive signal for the blockchain industry. Research and development for creating security-based lending protocols with risk-based controls and procedures are critical to building robust decentralized lending protocols.
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Image credits: Markus Winkler, Tezos, and Rodion Kutsaev.