Struct Finance, a DeFi protocol, has just closed a $3.9 million seed round. Twenty-four top companies participated in the seed round, including Blizzard Fund (Avalanche’s 200 Million fund), Antler, Arcanum Capital, Assymetries Technologies, Avalaunch, AVentures Dao, Bison Fund among others.
The funds will enable the protocol to provide structured products in the DeFi ecosystem by building tools that allow institutions to easily customize their interest rate products and compose them with options to construct structured products that will suit a wide array of investors.
“As crypto markets mature and DeFi takes root, the need for sophisticated instruments which are capable of supporting the demands of institutional and retail investors becomes paramount. Struct not only offers this, but also allows users to compose existing instruments together, opening an endless array of strategies. The team behind Struct has done nothing but build and execute around these novel concepts, and it’s an honor to be able to support them on their journey.” Mark Stanwyck, Co-Founder of Avalaunch said in a statement.
Structured products have come up in the crypto space with the advent of derivatives. They are products that utilize permutations of different interest rate products, options, and other financial instruments to construct investments that can be adapted to different risk profiles, market expectations, and asset classes. These products are already gaining popularity in DeFi as calls and cash-margined puts.
In spite of the growing popularity in DeFi though, many of the parameters on different derivative instruments are set by protocol developers and do not leave investors much choice. Many protocols also experience fragmented liquidity because of multiple maturity dates, which results in high slippage or considerable changes to discount rates at higher volume transactions under low market depth.
The Struct protocol changes this by making it possible for investors to customize interest rate instruments and compose them with options available in the ecosystem to construct superior financial products. It also gives investors more investment options and protection while providing them with highly-competitive yields on various digital assets. Launching on Avalanche, Struct Finance intends to support more Ethereum Virtual Machine (EVM) compatible chains in the near future to reach more investors.