The joint purchase means Dragonfly and Paradigm now control approximately 5.5 percent of the total MKR token supply. Combined, the acquisition makes Dragonfly and Paradigm the second-largest private holder of MKR tokens. VC firm Andreessen Horowitz remains the single largest private holder with the 6 percent stake it acquired in September 2018.
Announced Thursday by the Maker Foundation, the $27.5 million raised will fund the foundation’s efforts to promote dai adoption in China and the broader Asia region. It’s expected Dragonfly and Paradigm, who already have a strong presence in the region, will advise on the expansion.
Venture funds Dragonfly Capital and Paradigm have acquired $27.5 million worth of MKR tokens and plan to take part in the Maker Protocol’s governance system.
«Dai continues to be the stablecoin of choice in all global markets for its decentralization and overall stability,» said Rune Christensen, CEO of the Maker Foundation, in a statement. «The support and expertise of Dragonfly Partners and Paradigm will give Dai an unparalleled advantage in driving innovation and adoption in Asia.»
Dragonfly and Paradigm intend to play an active role in maker’s onchain governance. This will include participating in executive votes – the process that approves proposals that determine the ecosystem’s direction.
Stakeholders recently participated in one such vote to ratify the Foundation’s multi-collateral dai proposal in mid-November before it could be implemented.
Both Dragonfly and Paradigm will operate their own stakes independently of one another. It is uncertain yet whether one VC has acquired a larger share of maker tokens than the other. A Foundation spokesperson declined to comment.
The price of MKR jumped 3 percent on the announcement, according to data from CoinMarketCap.
The MakerDAO ecosystem is the market leader in decentralized finance. Nearly $320 million worth of assets are already locked in dai smart contracts, according to DeFi Pulse. In comparison, the second-largest protocol, derivatives provider Synthetix, currently has just under $168 million locked in smart contracts.
In a statement, Dragonfly Capital managing partner Alexander Pack said, «Asia is the most important market for crypto in general. It is also home to the largest concentration of the unbanked and underbanked around the globe, which we believe represents an enormous pent-up demand for decentralized financial products.»
Both VCs focus on investing in the cryptocurrency space. Dragonfly participated in the seed round for ethereum scaling solution Matter Labs. Among other things, Paradigm has invested in a startup building a lightweight blockchain, known as Coda.
Dutch Authorities Arrest 2 in Million-Euro Crypto Money Laundering Investigations
Dutch tax enforcers with the Netherlands’ Fiscal Intelligence and Investigation Services (FIOD) arrested two men Monday for allegedly laundering millions of euros in cryptocurrency, according to a joint statement by the Joint Chiefs of Global Tax Enforcement (J5).
FIOD arrested the Dutch nationals in separate crypto tax evasion investigations, recovering about 260,000 in unnamed cryptocurrencies and more than 6.6 pounds of gold. Credit and debit cards holding crypto and euros were also seized, among other items.
One of the suspects is alleged to have used the defunct bitcoin mixing service Bestmixer.io.
FIOD has stepped up its crypto policing recently. Working with tax authorities from the U.K., U.S., Australia and Canada – collectively, the J5 – agents have been sharing tips and data since 2018.
“The J5 challenge in the United States at the end of 2019 was important in our fight against crypto criminality”, FIOD’s Chief, Hans van der Vlist, said in a joint J5 statement. “The operational cooperation within the J5 is beginning to pay off.”
More bestmixer.io arrests may be around the corner; the J5 said further investigations “cannot be ruled out.”
