Derivatives DEX Kine raises $6 million in round led by Alex Pack, Naval Ravikant

Mar 2, 2021 | The Block News | 0 comments

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The team behind Kine Protocol has raised $6 million in a funding round to launch a derivatives-focused decentralized exchange on Ethereum.

The startup said Tuesday that leading investors in the round are Alexander Pack, former managing partner at Dragonfly Capital, and Naval Ravikant, co-founder and former CEO of AngelList. Other participating investors include OKEx, CMS Holdings, Spartan Capital and NGC.

Dragonfly and Ravikant also invested in derivatives DEX dYdX, which raised $10 million in a recent Series B round.

“Compared to top centralized solutions, DeFi derivatives protocols are a strictly inferior experience. For one, traders usually suffer much higher slippage,” Kine said in a Tuesday press statement. 

The startup said it aims to feature synthetic funding rates and auto-deleveraging functions used in centralized exchange so that Kine can offer up to 100x leverage and cross-margining.

To encounter the transaction bottleneck on the Ethereum network, Kine said it will initially take a hybrid approach in that its trading engine will be run off-chain.

“Users only need to pay gas for staking and margin transfers, with zero gas consumption on trading activities,” the startup said. “Kine can support 10,000+ simultaneous trading users with 4,000+ transactions per second.” 

Kine’s CEO Wang Lei said that the goal is to launch the exchange in mid-March and anticipate migrating the trading engine on-chain on a Layer-2 rollup during Q2 this year.

“We need to ensure that the Layer-2 is secure and efficient enough,” Wang said. “Because our envisioned target trading volume is incomparable to other DeFi protocols so it needs to handle CeFi-level trading volume.”

© 2021 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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