Web3 startup aPriori has raised $20 million in funding to expand its trading infrastructure platform, which aims to bring high-frequency trading (HFT) on-chain and address the technical and market challenges in decentralized finance (DeFi). This round of financing comes as institutional investors show increasing interest in DeFi as an alternative source of yield.
This funding round includes participation from institutions such as Pantera Capital, HashKey Capital, Primitive Ventures, IMC Trading, and Gate Labs, bringing the company's total funding to $30 million.
The San Francisco-based company was founded in 2023 by former quantitative traders and engineers who previously worked at Coinbase, Jump Trading, and Citadel Securities.
The aPriori platform aims to tackle several challenges in on-chain markets, including excessive spreads, miner extractable value (MEV) leakage, and toxic order flow. In traditional finance, toxic order flow refers to trading activities that expose market makers or liquidity providers to adverse selection risk.
aPriori joins the ranks of startups dedicated to bringing institutional-grade trading infrastructure on-chain. Earlier this year, Theo raised $20 million from supporters including Citadel, Jane Street, and JPMorgan to develop on-chain high-frequency trading and market-making strategies.
Other platforms taking a similar approach include Aevo (formerly Ribbon), which focuses on derivatives and options infrastructure, decentralized exchange dYdX, and Cega, which is developing structured products for on-chain markets.
Favorable regulatory developments, perceived advantages of blockchain technology, and the growing yield opportunities in DeFi are encouraging more institutions to enter on-chain markets. This shift has created greater demand for institutional-grade trading infrastructure.
Decentralized markets are also showing signs of offering higher returns than traditional currency markets, attracting yield-seeking institutional investors. For example, a report from RWA.xyz indicates that the current average annual percentage rate (APR) for the tokenized private credit market is 9.76%.
This segment of the tokenized market is valued at approximately $15.6 billion, accounting for more than half of all on-chain tokenized activity.
Meanwhile, large institutions are experimenting with cryptocurrency-related strategies. For instance, JPMorgan Asset Management recently committed to investing up to $500 million in Numerai, an AI-driven hedge fund with a crowdsourced trading model.
Numerai launched one of the first native tokens in 2017, reflecting how quantitative finance and blockchain are beginning to merge.
Related: Ledn, Sygnum secure $50 million Bitcoin (BTC) collateralized loan refinancing, achieving two times oversubscription
Original article: “aPriori, founded by former Coinbase, Jump, Citadel quantitative traders, raises $20 million for on-chain high-frequency trading platform”
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