Element Finance Raises $32M for DeFi Fixed Rate Protocol

Element Finance Secures $32 Million in Series A Funding

Element Finance has successfully completed a $32 million Series A funding round, resulting in a company valuation of $320 million. The firm is developing a novel decentralized finance (DeFi) protocol built on the Ethereum blockchain.

This innovative protocol enables investors to achieve predictable returns through fixed interest rates applied over specified durations.

Funding Round Details

Polychain Capital spearheaded the current funding round. Additional investors participating in this round include Republic, Advanced Blockchain, P2P Validator, Rarestone, and Ethereal Ventures, alongside contributions from their respective limited partners.

Existing investors have also reaffirmed their commitment, with renewed investment from Andreessen Horowitz, Placeholder, A_Capital0, and Scalar Capital. A significant number of DeFi developers also took part in the funding initiative.

Protocol Performance and Growth

Element Finance is a relatively recent entrant to the DeFi space, having launched its protocol on the Ethereum mainnet on June 30th. Despite its recent launch, the platform has already demonstrated considerable traction.

Currently, the total value locked (TVL) within the protocol stands at approximately $180 million.

Investment Options and Features

Users can currently engage with 10 distinct fixed-rate pools. These pools accept contributions in the form of stablecoins like DAI and USDC.

Furthermore, popular (wrapped) cryptocurrencies, such as wBTC, and complex derivative assets, including steCRV (representing a stake in the Curve ETH/stETH liquidity pool), are also supported.

Beyond individual investors, Element Finance is actively targeting fund managers. A dedicated treasury management program has been initiated to encourage DeFi protocols, funds, and institutions to allocate capital to Element Finance.

Fixed vs. Variable Rate Pools

To facilitate fixed rates, some users can choose to contribute to liquidity pools offering variable interest rates. However, this approach precludes the ability to accurately forecast returns at the year’s end.

User Base and Future Plans

To date, over 9,000 users have utilized the Element Finance platform. The company intends to implement a governance system featuring diverse voting vaults and incentive structures.

The newly acquired funding will be used to expand the team across all departments.