Usual Labs has raised $7 million from investors, including IOSG and Kraken Ventures.
The French company plans to launch its USD0 stablecoin in the second quarter.
USD0 is a permissionless stablecoin backed by real-world assets and will pay holders a yield.
Usual Labs, the firm behind the decentralized finance (DeFi) protocol Usual, has raised $7 million and received $75 million commitment in total value locked (TVL) for the launch of its stablecoin USD0, the company said in a statement on Wednesday.
The French company raised money from more than a hundred firms, including two leading co-investors, IOSG and Kraken Ventures. Other investors included GSR, Mantle, Starkware, Flowdesk, Avid3, Bing Ventures, Breed, Hypersphere, Kima Ventures, Psalion, Public Works and X Ventures.
The $75 million in TVL consists of investments from the company’s direct investors and from entities and individuals within the ecosystem.
The fundraising will allow Usual Labs to prepare for the pre-launch of its USD0 stablecoin on the Ethereum mainnet in the second quarter, the company said. This includes completion of the testnet phase, building partnerships with industry leaders, and carrying out smart contract audits to guarantee the protocol’s security and efficiency, Usual said.
USD0 is a permissionless stablecoin backed by real-world assets. Holders of the coin will be rewarded with yields generated by these assets. It is one of a number of new stablecoin launches in an increasingly competitive market. The cumulative supply of the top three stablecoins, tether (USDT), USD Coin (USDC) and DAI (DAI), recently increased to $141.4 billion, the highest since May 2022. These three stablecoins dominate the market with over 90% share.
“The stablecoin market is highly competitive. This competitive landscape necessitated that Usual innovate to provide a distinctly different approach from our competitors,” said Pierre Person, CEO and co-founder of Usual, in emailed comments. “Usual is dedicated to delivering a stablecoin that upholds a higher standard of safety for its users, with a firm belief that both value and governance should be in the hands of the users,” Person added.
Stablecoins are being adopted for cross-border settlements, with payments firms, fintech companies and consumer platforms among the early users, Bernstein said in a research report last week.
Read more: Finance Protocol Usual Introduces Stablecoin Backed by Real-World Assets