Solana-based DeFi project Cyclos today announced it had successfully raised a total of $2.1 million combined from a private and a public funding round.
Developing the First Concentrated Liquidity AMM on Solana
Per the announcement, Cyclos will use the funds toward developing the first concentrated liquidity AMM on the Solana blockchain. The AMM will enable a wide variety of robust and innovative features never before seen in the blockchain industry.
Notably, Cyclos’ private round included numerous notable investors such as CMS Holdings, Hashkey, Solana Capital, Huobi Ventures, Coin98 Ventures, MXC, Gate.io, Skyvision Capital, Petrock Capital, Illusionist Group, Cryptomeria Capital, DigiStrats, and Youbi Capital.
For the uninitiated, Cyclos offers a unique spin on the idea of concentrated liquidity which was brought to the forefront by Ethereum-based decentralized exchange (DEX) Uniswap V3.
By leveraging Solana’s low-latency and high-throughput blockchain, Cyclos will be able to create concentrated liquidity tethered to Serum (SRM), a Solana-powered order book-based DEX. This way, Cyclos will offer all the benefits to capital efficiency intrinsic to concentrated liquidity.
Funds deployed with Cyclos will be used toward providing liquidity on Serum DEX as per the ranges specified by the LPs. With Serum involved, it will be ensured there is no need to bootstrap trading volume and initial liquidity for the AMM pools which would subsequently reduce the impermanent loss risk for new pairs and guarantee some income for LPs.
Specifically, Cyclos is incredibly used for stablecoin pairs that allow the creation of a market without using algorithms. In addition, Cyclos offers new features such as range orders and stop loss/limit orders, the first for a Solana AMM.
Commenting, Jason O’Brien, a spokesperson for Cyclos, said:
“We’re excited to fully begin the Cyclos journey with the strong backing we received. Cyclos introduces a myriad of functionalities to DeFi on Solana that, until now, were not possible with existing infrastructure. Range-limit orders, capital efficient liquidity pool bootstrapping and orderbook-based stable asset market making are all possible due to Cyclos’ innovative approach to concentrating liquidity providers’ assets.”
Similar sentiments were echoed by Dan Matuszewski, Partner at CMS.
“CMS is excited to support Cyclos in their mission to bring concentrated liquidity to Solana,” said Dan Matuszewski.
“The growing Solana user base has increased the demand for a world class AMM experience. The Cyclos team is strong and well positioned to have a material impact on advancing Solana’s DeFi ecosystem.”