ZkLend, a money market protocol based on StarkNet, has raised $5 million in a seed round led by Delphi Digital, StarkWare, and Three Arrows Capital. As the technology matures, more and more protocols are relying on Ethereum Layer-2 scaling solutions. Yearn Finance launched its first layer-2-powered business on the optimistic rollup protocol Arbitrum a month ago, while StarkWare raised $100 million at a $6 billion valuation three weeks ago. zkLend, a money market protocol based on StarkWare’s public zk-rollup scaling technology StarkNet, is the latest system to jump on the layer-2 bandwagon.
According to the press release, zkLend will be able to scale at a fraction of the cost of Ethereum (ETH) while retaining Ethereum’s high level of security. The $5 million raised will be used to launch the Artemis and Apollo products, as well as expand the company’s technical, marketing, and business development teams. Artemis is a permissionless lending platform that will launch in Q3 2022. According to zkLend, Artemis will allow DeFi members to borrow against their assets “cheaply, efficiently, and safely.” The second product, Apollo, a permissioned solution slated to arrive early next year, will be available to institutional and corporate users who want a KYC and AML-compliant solution.
To encourage users to join in the targeted money market pools, the protocol will use an innovative ouroboros approach. An ancient symbol representing a serpent or dragon eating its own tail is known as an “ouroboros”. Double-sided borrowing and collateralization factors, protocol-to-protocol lending, and variable liquidation costs are some of the other notable features offered by zkLend. The protocol’s native protocol token, ZEND, is a key component. Users that stake ZEND will be able to participate in governance, raise rate rewards, and collect a portion of the pools’ interest revenue.
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