Decentralized Finance protocol Avant rakes in $6.5 million during its seed funding round, relying on the avalanche blockchain.
Avant, a Decentralized Finance (DeFi) protocol on the Avalanche network, has successfully secured $6.5 million in a seed round. The funding will be used to scale Avant's crypto-yield generating neutral tokens without relying on centralized exchanges.
Avant's unique offering, the avUSD stable-value token, allows users to mint avUSD by staking USDC or USDT stablecoins. In return, they receive a yield-generating version of the token called savUSD. The total value locked in Avant's DeFi protocol is over $5 million, as stated by founder Rhett Shipp.
Avant's product differs fundamentally from Ethena's $ENA token. While Ethena's USDe is a synthetic dollar stablecoin employing a delta-neutral collateralization strategy, Avant's avUSD and savUSD tokens are generated through direct crypto yield generation via lending or staking-like protocols.
The avUSD and savUSD tokens offer the potential for higher yields, depending on lending demand, staking returns, and protocol-specific factors. Avant believes it can perform the carry trade more productively than its peers, thanks to its dynamic strategies that align with market conditions.
Participants in the funding round include Superlayer, Avalaunch, GoGoPool, Daybreak Digital, and Linda Kreitzman. Avant plans to launch its native token AVANT in the first quarter of 2025. The whitelist for staking on Avant will expand over the next few weeks, with avUSD and savUSD set to be open to the public in December.
Ethena, on the other hand, uses a separate "Internet Bond" token (sUSDe) that allows stakers to earn yields derived from Ethereum staking rewards (via stETH) and funding fees from perpetual futures markets. The yield is therefore linked to relatively stable income sources like staking rewards and market inefficiencies on futures, making it different from direct lending yields.
Avant charges at least 10% in fees on the yield generated from staked tokens. This fee structure, combined with the potential for higher yields, makes Avant an attractive option for those seeking higher returns in the crypto market. As Avant continues to grow and scale, it will be interesting to see how it compares to other DeFi protocols in terms of yield generation and user adoption.
Sources:
- Avant Raises $6.5 Million to Scale Crypto-Yield Generating Neutral Tokens
- Avant vs. Ethena: A Comparative Analysis of Crypto Yield Products
- Understanding Avant's Staking Mechanism
- Ethena's sUSDe Token Explained
- Maximizing Yield with Avant's Staking Protocol
The news of Avant's successful $6.5 million funding round sets the stage for the scaling of their DeFi protocol, focusing on finance and technology by generating crypto yields without relying on centralized exchanges. As Avant's unique avUSD and savUSD tokens offer higher yields, depending on lending demand, staking returns, and protocol-specific factors, they aim to outperform peers in the growing DeFi industry.
