Preparing for mainnet, Cork secures investments from OrangeDAO, a16z CSX (NASDAQ:CSX), Ideo Ventures, Steakhouse Financial, Outliers Fund, and Unbounded Capital, among others to accelerate launch
Cork Protocol, which has built the new DeFi primitive similar to credit default swaps for pegged crypto assets, today announces its participation in the a16z Crypto CSX Fall 2024 cohort. Backed by investors including OrangeDAO and Ideo, Cork Protocol’s participation in the 8-week program aims to speed up its early-stage go-to-market strategy.
The missing piece that will bring maturity to the emergent crypto financial system is competitive market risk pricing, whether for insurance or efficient hedging. One asset class that is sorely lacking these tools is crypto assets that track a par value (stablecoins, LSTs, LRTs, etc). These often experience ‘depegs’ or price deviations from par in secondary markets. Notable cases include USDC in March 2023 or situations in emerging technologies, such as the temporary depegs of Liquid Restaking Tokens (LRTs). These events have the potential to cause cascading liquidations across borrowing and lending protocols and propagate risk across the system as a whole.
Cork Protocol introduces Depeg Swaps to bring the power of competitive markets in risk pricing to crypto. Cork Protocol can be used as part of a long-term buy-and-hold strategy by rolling hedges, as a yield enhancement for underwriters of the hedged asset, or as part of a collateral stack for lending and borrowing. The Cork Protocol team hopes that using the platform will aid crypto users and institutions in finding temporary price deviations less frequent, shorter, and less severe. While Cork cannot prevent black swan events, it offers investors a way to price risk and insurance against both temporary and permanent depegs.
Cork can offer institutional users of liquid staking tokens, like stETH, access to competitively priced and effective market insurance for slashing and liquidity risks. Depeg Swaps are also designed for other crypto assets, including stablecoins or restaking tokens, like eETH, for users who wish to hedge more complex positions on-chain. Cork has received investment from Web3 leaders, including a16z CSX, OrangeDAO, Ideo Ventures, Outliers Fund, Unbounded Capital, Steakhouse Financial, and 20 other investors and angels from Tradfi and DeFi.
In conjunction with this announcement, Cork Protocol is launching a Testnet Trading Competition starting the week of September 17th. The competition will take place on the Sepolia Testnet, allowing participants to test the protocol under simulated conditions while competing for profits and reporting any bugs found during the competition. A total of 1.75 ETH will be awarded for tasks like 0.5 ETH to the trader with the highest overall profit, 0.25 ETH for the most profitable liquidity provider, and 0.1 ETH for the best bug report.
What Others Are Saying About Cork:
Cork Protocol is a decentralized finance (DeFi) platform that introduces Depeg Swaps, a new financial primitive designed to price and manage the risks associated with pegged assets, such as stablecoins and liquid (re)staking tokens. Cork Protocol aims to enhance liquidity, reduce risk, and foster safer on-chain credit markets by providing tools for both hedging and trading risk.
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ContactExecutiveKyle HeiseC3kyle@cryptocontent.co
This article was originally published on Chainwire
Source: Cryptocurrency - investing.com
