SEOUL, SOUTH KOREA / ACCESSWIRE / September 30, 2021 / Kokoa Finance has raised $2.3 million in a seed investment round led by Hashed and joined by Sky Vision Capital, a41 Ventures, and a number of individual angel investors. The funding will be used to build the backbone of DeFi on Klaytn, the blockchain launched by Kakao, the company KakaoTalk, the largest messaging app in South Korea.
The Klaytn blockchain was launched in 2019 and achieved strong success owing to its integration with KakaoTalk and the native Klip wallet, which boasts over one million users. The platform reached a capitalization of $4 billion, thanks primarily to its popularity and organic adoption in Korea. Den's DeFi ecosystem is nascent despite this success, offering lucrative opportunities for projects like Kokoa Finance.
Kokoa Finance is going to build one of the key DeFi building blocks on Klaytn, the Kokoa Stable Dollar (KSD) stablecoin, whose architecture is similar to DAI on Ethereum. Kokoa introduces a key innovation over the MakerDAO collateralized vault model, eliminating the need for KSD borrowers to pay interest for creating the stablecoin. Instead, assets held in Kokoa Collateralized Debt Positions will be utilized in Klaytn's yield generation opportunities, generating low-risk yield and increasing capital efficiency for the protocol. This structure enables charging zero interest rates for borrowing KSD, making it comparable to an "advance" on future yield. The model chosen by Kokoa is expected to maintain stability due to its collateral backing, avoiding the pitfalls seen in ambitious algorithmic stablecoin projects.
Following the initial launch, the Kokoa team will implement DAO governance and gradually add features to grow the KSD ecosystem, including margin trading, leveraged yield farming, a generalized synthetic asset protocol and a stable swap platform.
"We believe Klaytn is one of those hidden gems platforms that's going to make waves in the future," said Jwon Do, Founder of Kokoa Finance. "Its DeFi ecosystem is still immature, and given its already significant success, it's an amazing opportunity for anyone willing to take it. By launching Kokoa and KSD first, we expect to start the flywheel of DeFi adoption on this chain and lay the carpet for new builders and users."
"The Klaytn ecosystem has remained under the radar, until now," said Simon Seojoon Kim, Co-founder and CEO at Hashed. "Kokoa is poised to become the primary DeFi entry point to Klaytn ecosystem. We were impressed by the team and their ability to innovate over existing DeFi primitives, taking lessons from the first generation of protocols and tweaking them to create something better."
About Kokoa Finance
Kokoa is the entrypoint to Klaytn DeFi, offering a combined stablecoin and yield generation protocol to power the next wave of DeFi adoption. Building in the $4 billion Klaytn ecosystem, Kokoa aims to leverage the natural adoption of Klaytn in Asia to build a mainstream DeFi platform. Kokoa users can create and transact with the Kokoa Stable Dollar (KSD), a decentralized stablecoin backed by crypto collateral. By using the power of DeFi composability, Kokoa achieves high capital efficiency by automatically earning yield with KSD collateral and thus enabling interest-free stablecoin generation.
Hashed is an investment firm that focuses on blockchain. The firm's focus is contributing to a decentralized future through investment, community building, and support. Hashed works to enable their portfolio companies to penetrate the global market seamlessly, and bootstrap their communities as well as the startup-building process. As an early investor to Kakao's Klaytn and Line's LINK, Hashed has invested early in many successful blockchain projects of Asia tech giants. The firm also runs ‘Hashed Lounge' as a co-working and offline meet-up space for early blockchain projects.
Head of Growth