Thetanuts Finance, a decentralized finance (DeFi) protocol that offers cryptocurrency options contracts, has raised $17 million to offer a buying marketplace and an expanded list of coins, the team announced April 24.
Thetanuts Finance has completed a $17M institutional funding round led by @polychain, @HyperchainC & @Magnus_fundsupporting our ambition to create a thriving two-way altcoin option market and continue to push the boundaries for structured DeFi products. https://t.co/BH4aOUEckd pic.twitter.com/mmGBuCmBHu
— Thetanuts Finance (@ThetanutsFi) April 24, 2023
The funding round was led by cryptocurrency investment firms Polychain Capital, Hyperchain Capital, and Magnus Capital.
Thetanuts currently offers DeFi Options Vaults (DOVs), which are smart contracts that allow investors to sell call or put options on Ether (ETH), Wrapped Bitcoin (WBTC), Fantom (FTM), Avalanche (AVAX), and other cryptocurrencies.
The team plans to use the new funds to produce a “buy-side altcoin options marketplace” to attract more option buyers. The announcement states that, until now, DeFi options protocols have focused on attracting sellers looking for stable income rather than options traders looking to gain leverage. With the newly raised capital, the developers hope to be one of the first protocols to offer products suitable for the buy side of the options market.
They also hope to expand the coin offering to include more altcoins or coins with lower market capitalization, including tokens from networks that do not use the Ethereum Virtual Machine (EVM). The new options market will combine aspects of an Automated Market Maker (AMM) protocol and a traditional money market to create a single options trading system. It will be available in beta “soon”.
Josh Rosenthal, Portfolio Manager at Polychain Capital, stated that the new market will contribute to the stability of the financial market in the transition to Web3: “Functional derivatives are a key component of a healthy financial market.”
The traditional futures and options market traded more than 60.6 billion contracts in the first nine months of 2022, according to research by the FIA world trade organization. For this reason, cryptocurrency companies are increasingly turning to the futures market. On April 20, Coinbase announced that it is developing a Bermuda-based crypto derivatives exchange. On April 22, Gemini announced that it would also offer Bitcoin (BTC) and Ether options on a non-US exchange in the near future.
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