Cyclos, a newly developed Solana-powered DeFi project, has secured $2.1 million in capital (combined from a private and a public round).
The proceeds will be directed towards developing the “first” concentrated liquidity AMM (automated market maker) on Solana, which will enable several features “never seen before in the blockchain’s ecosystem,” according to a release shared with Crowdfund Insider.
The private investment round included contributions from several investors such as CMS Holdings, Hashkey, Solana Capital, Huobi Ventures, Coin98 Ventures, MXC, Gate.io, Skyvision Capital, Petrock Capital, Illusionist Group, Cryptomeria Capital, DigiStrats and Youbi Capital.
Cyclos aims to provide a “unique” spin on the idea of concentrated liquidity “pioneered” by Uniswap V3. By utilizing Solana and its “low-latency, high throughput” blockchain, it’s possible to “create concentrated liquidity tethered to Serum, an order book-based decentralized exchange,” the announcement explained. This offers all the benefits to capital efficiency “intrinsic to concentrated liquidity, with few of the downsides.”
The update also mentioned that the funds committed to Cyclos are “used to provide liquidity on Serum DEX according to the ranges specified by the LPs.”
As stated in the release:
“Using Serum means that there is no need to bootstrap volume and initial liquidity for the AMM pools, reducing impermanent loss risk for new pairs and immediately guaranteeing some income for LPs. Cyclos is particularly useful for stablecoin pairs, where it becomes possible to make markets without using algorithms. Additionally, Cyclos enables new features like range orders and stop loss/limit orders, the first for a Solana AMM.”
Jason O’Brien, a representative for Cyclos, said they’re excited to begin the Cyclos journey with the “strong backing [they] received.”
Jason also noted that Cyclos introduces various functionalities to DeFi on Solana that, “until now, were not possible with existing infrastructure.” Jason added that range-limit orders, capital efficient liquidity pool bootstrapping and orderbook-based stable asset market making are all “possible due to Cyclos’ innovative approach to concentrating liquidity providers’ assets.”
Dan Matuszewski, Partner at CMS, remarked:
“CMS is excited to support Cyclos in their mission to bring concentrated liquidity to Solana. The growing Solana user base has increased the demand for a world class AMM experience. The Cyclos team is strong and well positioned to have a material impact on advancing Solana’s DeFi ecosystem.”
As noted in the announcement, Cyclos is “the first concentrated liquidity market maker on Solana.”
Cyclos allows liquidity providers to “maximize the yield-earning potential of their assets by placing individualized price curves directly on Serum’s order books.” The V1 of the product is “due to launch in Q3, 2021.”
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