The team behind Bancor, a protocol for providing liquidity to on-chain tokens, has announced that it has received an investment from ParaFi Capital.
The announcement does not make it clear how much the investment amounts to.
First of all, here are some details about ParaFi Capital, a company focused on investments in crypto, blockchain and decentralized finance (DeFi) projects.
With more than 20 years of experience, they have managed funds for KKR, TPG and JPMorgan. It is worth mentioning that ParaFi Capital also includes several institutions such as Bain Capital Ventures, Galaxy Digital, and Dragonfly Capital Partners.
Santiago Roel Santos, one of ParaFi Capital’s partners, said:
“We believe Bancor v2 is a step function improvement in the automated-market maker (AMM) space. With trade volume and liquidity rapidly moving into AMM-based markets, we believe Bancor is uniquely positioned to benefit from this underlying market shift. We are thrilled to be involved with the Bancor ecosystem during the protocol’s next phase of growth.”
What is Bancor and how will it use ParaFi Capital’s funds?
Bancor (BNT) is one of the leading protocols in DeFi together with Uniswap and Balancer.
Through its various pools, it allows providing liquidity, both to the tokens of the Ethereum blockchain, the various ERC20s, and to the tokens that can be found on the EOS blockchain.
Creating a pool here is very easy and anyone can do it, for example to list their own token.Â
The new version of Bancor, v2, which solves the famous problem of impermanent loss, was launched at the beginning of August thanks to a partnership with Chainlink (LINK).
Bancor is one of the few protocols where it is possible to use only one token instead of two.
Thanks to these funds it will be possible to further expand this protocol: in fact, for the moment there are only 2 new pools under test, LINK and REN, which in a few weeks will be blocked and will launch, while instead the BNT Liquidity Mining model will continue, so all those who will provide liquidity to the various pools will be able to receive, in addition to fees, also BNT tokens.
Bancor’s head of growth, Nate Hindman, has said he is ready to scale v2 and also introduce BancorDAO:
 “With their deep experience in DeFi and institutional markets, ParaFi’s involvement will bring substantial expertise as we prepare to scale Bancor v2, release the BancorDAO and deploy BNT Liquidity Mining.”
