Yala, a pioneering crypto startup, has secured $8 million in seed funding to bolster its development of a Bitcoin-backed stablecoin. This funding round was co-led by Polychain Capital and Ethereal Ventures, with participation from notable investors such as Galaxy Vision Hill, Anagram, ABCDE, Amber Group, HashKey Capital, Satoshi Lab, and UTXO Management.
The seed round was oversubscribed, initially targeting $5 million, according to Yala's co-founder and COO, Kaitai Chang. Capital raising began in March and concluded last month. The funding was structured as a Simple Agreement for Future Equity (SAFE) with token warrants, though details on Yala's valuation remain undisclosed.
Founded in January 2023 by Kaitai Chang, former Binance Labs employee, Bin Liu, co-founder of Alchemy Pay, and Vicky Fu, ex-director of engineering at Circle, Yala aims to enhance decentralized finance (DeFi) on Bitcoin.
Yala is developing a Bitcoin-backed stablecoin named YU, allowing users to mint YU by depositing Bitcoin onto any blockchain via MetaMint. This cross-chain protocol simplifies the conversion of native BTC into stablecoins on EVM-compatible networks.
The startup has attracted commitments exceeding 2,000 BTC (approximately $126 million) for its protocol. Currently, Yala accepts BTC as collateral, with plans to include Bitcoin liquid staking tokens in the future.
To tackle challenges associated with Bitcoin's 10-minute block production time, Yala will introduce an insurance feature called Takaful. This cooperative framework will help manage risks related to Bitcoin price volatility and high-risk activities.
The Yala protocol is under development, with a testnet expected to launch soon and the mainnet projected for Q1 2024. The governance token, YALA, will also be launched alongside the mainnet. Currently, Yala employs 23 remote workers worldwide, with plans for team expansion in various functions such as business development, engineering, and marketing.
