Victor Ugochukwu · Dec 14, 2020 . 5min read
Cozy Finance Develops DeFi Risk Management Tools, Raises $2M in Seed Round
DeFi is surrounded by risks, to curb them Cozy Finance intends to develop DeFi risk management tools and provide those tools to the community.
By Komal Joshi · Sep 5, 2020 . 6min read
Cozy Finance announced that it had raised $2M in a seed round. The investors include Electric Capital, Variant Fund, Dragonfly Capital, Robot Ventures, Slow Ventures, Kain Warwick (founder of Synthetix), Spencer Noon, Ed Moncada (founder of Blockfolio), Volt Capital, and others. Cozy Finance is a company that develops risk-management software for decentralized Finance (DeFi).
The value of assets invested in Ethereum-based DeFi dapps has risen from $1B-$8B in six months. Developers have unhitched massive amounts for crypto investors by developing helpful ways for them to handle their assets. Nevertheless, these users face new forms of risk, such as irreversible technical vulnerabilities.
A lack of reliable and DeFi-native risk management tools stops a flood of users from penetrating the space and enjoying the benefits of open and permissionless products. The Cozy Finance team comprises of serial entrepreneurs who have been developing open and community-driven products for years. Additionally, they are true believers in the transformative potential and understand that sustainable growth needs reliable and native tools to manage risks. Cozy Finance aims to provide those tools to the community. It seeks to develop something new, which will be unique to the tools available in the market.
Projects Focusing on DeFi Risk Management
The most crucial consideration for developers and entrepreneurs today is to make applications that are future-ready and secure. Future-ready needs developing on a network that has the foundation to scale for retail financial use cases. Further, various players are trying to make DeFi safer. For instance, London-based Nexus Mutual operates a decentralized risk pool. It is created to hedge against DeFi smart contracts blowing up, which appears to be an acceptable risk.
Additionally, as a next-generation blockchain, Conflux Network is building the protocol to address some of the security vulnerabilities encountered by previous generation protocols. The blockchain operates on a unique PoW algorithm. Additionally, it possesses a built-in Staking Contract for added incentives to miners to keep the network secure. Conflux virtual machine guarantees Re-entrance Protection, which indicates that when calling a contract, it makes sure that the attack is improbable by invalidating codes to be performed in re-entrance calls.
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