Blockchain derivatives exchange Drift Labs announced that they have successfully raised $3.8 million in the Seed Round, led by VC firm Multicoin Capital.
Successful Seed Round
In the statement released via Twitter and on their Medium page, the company also listed the other VC firms that have participated in the Seed Round, namely Alameda Research, Jump Capital, LedgerPrime, Not3Lau Capital (Darren & Daryl Lau), QCP Capital, Robot Ventures (Tarun Chitra and Robert Leshner), and ROK Capital.
The funding round also brought in several angel investors like Jason Choi (Spartan Capital), Julian Koh (Ribbon Finance), Loi Luu (Kyber), Celia Wan (Dragonfly Capital), Dom Tsang (Solana), Hassan Bassiri, (Arca), Windra Thio (Element), and Zhuoxun Yin (Coinbase/dYdX).
The firm tweeted out,
“We’re delighted to announce a $3.8M strategic fundraise to build the best on-chain derivatives trading experience on Solana.”
As per the announcement, the funds raised will be channeled towards expanding the Drift Labs team and providing liquidity on its Dynamic AMM (DAMM) and insurance fund.
Drift Protocol DAMM Addresses Capital Efficiency
As the first perpetual swap exchange to leverage a DAMM, Drift Protocol provides a more flexible service compared to traditional vAMMs or AMMs by reducing capital slippage and increasing order capacity.
Multicoin Capital’s Co-founder and Managing Partner, Kyle Samani, spoke on the decision to invest in the seed round for Drift,
“The DEX trading experience has lagged behind because slippage is high for large orders, and transferring funds between platforms is subject to massive gas fees. Low liquidity also leads to poor pricing…Cross-margining is also one of the hardest features to implement in an exchange, but also one of the most requested features by traders. Drift has figured out how to do all of this, at scale, in a decentralized, non-custodial way.”
Drift And Solana
The announcement also acknowledged the contribution of the Solana grant and the overall support from the Solana community. The company aims to become the top decentralized futures exchange on Solana. It has recently launched its alpha mainnet with restricted access to select members within its community to ensure a gradual but smooth technical roll-out. Staggered access will be granted over the next few weeks to Solana communities that have played a crucial role in Drift’s journey till now.
The Drift Protocol has successfully serviced over 10,000 traders, with a total traded amount of over $2 billion to date. The platform intends to develop futures decentralized exchanges to make them the most efficient trading vehicle for digital currencies.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.