DeFi Protocol Velar Raises $3.5M to Build First Bitcoin DEX for Perpetual Swaps

Bitcoin-based DeFi is advancing rapidly towards becoming a fully fledged ecosystem. The latest evidence of this trend is manifested in the funding round secured by Velar to create a PerpDEX on Bitcoin. $3.5M has been secured in seed funding to advance the goal of bringing perpetual swaps to Bitcoin infrastructure.

A host of blockchain VCs participate in the round including Bitcoin Startup Lab, CMS Holdings, and Black Edge Capital. Like many astute venture firms, they see the upside to recreating decentralized finance infrastructure on Bitcoin and are in a race to fund the startups who can secure first mover advantage within their respective verticals.

Velar Is Bringing Perpetual Swaps Onchain

Generally speaking, the first protocol to ship its solution on an emerging ecosystem tends to fare well. Think Uniswap on Ethereum or GMX on Arbitrum. Velar is hoping to follow suit by creating the world’s first perpetual decentralized exchange (PerpDEX) on Bitcoin. This will allow futures trading of assets such as BTC and ETH.

While Bitcoin wasn’t built for DeFi since it’s not a smart contract network, enterprising developers such as Ordinals’ Casey Rodarmor have found workarounds, inspiring Bitcoin protocols such as Atomicals and BRC-20. As a result, the sort of DeFi primitives commonly found on EVM chains are now taking root on Bitcoin, either on the L1 blockchain itself or on L2 networks such as Stacks.

The Velar team is already deeply familiar with Stacks having developed Dharma, a Uniswap v2-inspired AMM built on the Bitcoin L2. Its launch will be followed by Velar Artha, the name given to the PerpDEX it’s now developing.

Why Do DeFi on Bitcoin?

There are a number of reasons why recreating decentralized finance on Bitcoin infrastructure makes sense, the most compelling being the billions of dollars of liquidity currently lying idle. BTC is not a productive asset by default, which means holders have nothing to do aside from, well, hold and wait for number to go up. The release of DeFi protocols on Bitcoin will provide opportunities for BTC whal

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Author: CryptoDaily

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