Avalon Labs, the issuer of the BTC-backed stablecoin USDa, has raised $10 million to grow its Bitcoin decentralized finance (DeFi) ecosystem.
The Series A funding round was led by Framework Ventures and included contributions from UXTO Management, Presto Labs, and Kenetic Capital, according to an announcement shared with CoinDesk on Monday.
Avalon aims to evolve BTC from a digital store of value into a more active financial instrument that can serve a range of different purposes.
Users can unlock the value stored in their Bitcoin by collateralizing it to the USDA at a fixed borrowing rate of 8%. Token Its total value reached $700 million (TVL) earlier this month.
Along with its stablecoin, Avalon offers bitcoin-backed lending, yield-generating savings accounts and a credit card.
Stablecoins are a type of digital token whose value is tied to another currency, usually the US dollar. Their purpose is to give users the option to protect their funds from the volatility associated with cryptocurrencies without having to remove them from the cryptocurrency ecosystem completely.
Read more: Stablecoin market cap hits $200 billion, could double in 2025 as adoption accelerates
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