Avalon Labs, the issuer of the BTC-backed USDa stablecoin, 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 variety of different purposes.
Users can unlock the value stored in their BTC by collateralizing it for USDa at a fixed 8% lending rate. The token reached $700 million in total value locked (TVL) earlier this month.
Along with its stablecoin, Avalon offers bitcoin-backed loans, yield-generating savings accounts, and a credit card.
Stablecoins are a type of digital token whose value is pegged to another currency, typically the US dollar. Its purpose is to give users the option to protect their funds from the volatility associated with cryptocurrencies without having to completely remove them from the crypto ecosystem.
Read More: Stablecoin Market Cap Reaches $200 Billion Milestone, Could Double by 2025 as Adoption Accelerates
