Bitcoin-based DeFi protocol Sovryn raises $2.5 million in a token pre-sale

Quick Take

  • Bitcoin-based DeFi protocol Sovryn has raised $2.5 million in a token pre-sale.
  • The funds are primarily earmarked for further developing the Sovryn protocol, its security, and a bug bounty program, co-founder Edan Yago told The Block.

Bitcoin-based decentralized finance (DeFi) protocol Sovryn announced Thursday that it has raised $2.5 million in a token pre-sale.

Sovryn said the pre-sale was reserved for its community, which allowed participants to secure their right to purchase SOV, the protocol's native token. SOV is launching next month, said Sovryn.

Participants, however, have the right to cancel the pre-reservation, Sovryn co-founder Edan Yago told The Block, adding that but "none have indicated to do so."

Their funds will be locked up for ten months, as part of their "long-term commitment to the project," said Sovryn.

The raised capital is primarily earmarked for further developing the Sovryn protocol, its security, and a bug bounty program, Yago told The Block. Still, the community governance would decide how to utilize it, he said.

Sovryn is a bitcoin-based smart contract protocol that offers swaps, lending, leveraged trading, and market-making. "The system runs on the Rootstock (RSK) sidechain, which is merge-mined with Bitcoin," Yago explained. "This means that it is secured by Bitcoin proof-of-work and bitcoin is the native asset (the asset in which all fees are paid)."

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Yago said transaction fees of the protocol are 30 to 100 times cheaper than Ethereum-based DeFi protocols. The current average cost per transaction on Ethereum is about $8.5, according to data from YCharts.

While Sovryn is a bitcoin-based DeFi protocol, it also supports Ethereum tokens, said Yago.

Sovryn's token pre-sale comes a month after it raised $2.1 million from venture firms, including Collider Ventures and Monday Capital, in December.

As for whether Sovryn looks to raise more funds in the near future, Yago said it is yet to be determined. "All such raises are performed by the protocol, and require a community vote," he said. "The voting system will be upgraded on February 5, after which a vote will be held on the next pre-sale."


© 2023 The Block. 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.

About Author

Yogita Khatri is a senior reporter at The Block, covering all things crypto. As one of the earliest team members, Yogita has played a pivotal role in breaking numerous stories, exclusives and scoops. With nearly 3,000 articles under her belt, Yogita holds the records as The Block's most-published and most-read author of all time. Prior to joining The Block, Yogita worked at crypto publication CoinDesk and The Economic Times, where she wrote on personal finance. To contact her, email: [email protected]. For her latest work, follow her on X @Yogita_Khatri5.