- The protocol’s total financing now stands at $15 million.
- The funds are to be used to expand its team and bolster its native stablecoin USDH.
On Thursday, Solana-based DeFi protocol Hubble announced it had completed a $5 million funding round led by Multicoin Capital. Following the funding round, the protocol’s total financing now stands at $15 million.
Hubble plans to use the fresh funds to expand its team and bolster and promote USDH, as a “censorship-resistant, decentralized stablecoin.” The firm further announced its plans to use the funds to create a Solana-based equivalent of MakerDAO: a DeFi protocol with a U.S. dollar-denominated stablecoin.
The fundraiser is expected to support the development of new products and services that will allow users to transact or earn a further yield on USDH throughout the Solana DeFi network.
Reportedly, Hubble co-founder Marius Ciubotariu wants to use the funds to hire Solana developers to help build out the protocol. Further, the protocol is planning to incorporate Kamino Finance, a Solana-based product that “bootstrap[s] liquidity” by helping users transact with USDH.
“The game we need to win is network effects and trust. So we have to do it by showing good risk management practices”, Ciubotariu said.
Spencer Applebaum, Principal, Multicoin Capital says, “There are only a few ways to safely build a decentralized stablecoin, and Hubble’s over-collateralization approach has been tested through all market conditions”.
The latest funding round follows a $10 million dollar funding in January led by the now bankrupt Three Arrows Capital(3AC), DeFiance Capital, and Digital Currency Group.
The Hubble Protocol is based on Solana, the blockchain that tackles scalability issues by combining proof-of-stake and proof-of-history consensus methods to support a high volume of transactions per second.
Its stablecoin USDH stands out from other stablecoins because it is entirely backed exclusively by cryptocurrencies, while other stablecoins like USDT or USDC are backed by a fiat currency USD.
By limiting USDH’s exposure to American banks, Hubble also claims it is reducing both the stablecoin’s ability to be censored by the American government and its need to answer to centralized institutions. The fundraising will likely improve USDH’s position as a rival to USDT or USDC.