Composable Finance, the interoperability protocol for Decentralized Finance (DeFi), has announced a $ 7 million increase backed by 16 reputable blockchain investment firms.
The funding round was led by Advanced Blockchain AG and Rarestone Capital, according to a statement released on Tuesday. Other contributors include Alameda Research, Spartan Group, Divergence Ventures, and Blockchain Capital.
Composable Finance aims to improve DeFi sync with a two-way approach to interoperability on both Ethereum and Polkadot, the latter forming the basis for further cross-sectoral engagement.
According to Cosmin Gregor, CEO of Composable Finance, blockchain interoperability will push new technology into a “new world of opportunity.”
Due to the asynchronous nature of the blockchain space, a bridge is often required to move liquidity between tiers and chains. As Cointelegraph previously reported, cross-chain fusion is seen as a panacea for liquidity fragmentation in the DeFi space.
In an interview with Cointelegraph, Composable Funding developer 0xbrainjar summarized the ultimate goals of the project:
“We are seeing a big shift in Ethereum with the popularity of many levels with twos and sidechains. You will need an accessible adhesive middleware infrastructure for people to build multi-tier applications (e.g. ZkSync <> optimism). ”
According to 0xbrainjar, this syntax may be needed to develop end-to-end strategies for actions like quick loans in a DeFi room.
As part of the announcement, Composable announced that it is in the final stages of finalizing several infrastructure solutions of level 2. Meanwhile, the project also plans to deploy Polkadot solutions by the end of June.
With Polkadot-based solutions critical to the project’s interconnection plans, Composable is said to employ a unique strategy for parachute auctions. The project is reportedly rolling out a storage strategy that will allow users to embed Ether (ETH) or other ERC-20 tokens.
Licensed ETH or ERC-20 tokens will be used to increase dividends, with 50% of the winnings returned to users and the other half used to buy DOT or KSM for the parachute auction itself.
Describing in detail how the Polkadot project solutions will be reflected in the blockchain interoperability plans, 0xbrainjar notes: “By using the Polkadot ecosystem, we will be able to allow developers from different ecosystems to distribute different Tier 1 smart contracts in one place and make them interact with each other. “.