Altcoins July 23, 2018 Daily Hodl Staff

Ethereum Network Boasts Majority of New Stablecoins That Attracted $240 Million in Funding

New stablecoin solutions have raised more than $240 million in funding, according to research conducted by Diar.

Basis, backed by Andreessen Horowitz, Bain Capital Ventures, Pantera, DCG, Polychain, MetaStable, 1confirmation and Naval Ravikant, tops the list of 13 projects with $133 million in venture capital raised.

Seven of the stablecoins are built on the Ethereum blockchain. They include Basis, nUSD, TrueUSD, MakerDAO, Fragments, StableUSD and Circle USD.

Andreessen Horowitz, Pantera Capital and Digital Currency Group make multiple entries in the report, with each VC making investments in three separate stablecoin projects.

According to the report, Tether is the most price-stable of the existing stablecoins, followed by Dai and TrueUSD. At the same time, Tether is the most controversial.

Several reports have challenged Tether’s claims that the coin is backed by the US dollar 1:1. Reports also allege that Tether has been used to manipulate the price of Bitcoin.

“I have long suspected that in the event Tether and Bitfinex has the money they claim to have, we’d have to inspect the order of the transactions to ensure they were not running pump and dumps with fake money,” wrote a Medium blogger in February. “Under that scenario, they would print hundreds of millions of Tethers, buy Bitcoins, transfer the bitcoins to say, GDAX… then once they pumped it up enough… liquidate the bitcoins and then funnel the money back to their bank. ‘See! The money is all there!'”

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The backers of Tether addressed the concerns when they hired a law firm to review their reserves – while also stating that an official audit isn’t possible.

Although the law firm concluded the company’s balances showed more than the dollar value of all Tether coins in circulation that day, no independent audit has been released to date.

The quarter billion dollars in venture capital raised for stablecoin solutions shows that the quest for a more perfect stablecoin is far from over.

At the same time, in the world of crypto, even a stablecoin can have double-digit volatility. Diar reports that BitShares’ bitUSD topped the list in terms of annualized volatility – at 67%.

Name	Raised in VC	Investors
Tether	n/a	n/a
Basis (ERC20)	$133 million	Andreessen Horowitz, Bain Capital Ventures, Pantera, DCG, Polychain, MetaStable, 1confirmation, Naval Ravikant
Saga	$30 million	Mangrove Capital Partners, Lightspeed Venture Partners, The Singulariteam Technology Group and Initial Capital
nUSD (ERC20)	$30 million (ICO)	n/a
TrueUSD (ERC20)	$21.7 million	Andreessen Horowitz, BlockTower Capital, Pathfinder, Jump Trading Capital, Foundation Capital, DHVC, Distributed Global, ZhenFund, Stanford-StartX, Signia Venture Partners, GGV Capital
Dai (ERC20)	$12 million	Andreessen Horowitz, Polychain, Distributed Capital Partners, Scanate, FBG Capital, Wyre Capital, Walden Bridge Capital, 1confirmation
Reserve	$5 million	Coinbase, Distributed Global, GSR.IO, Peter Thiel and others
Stronghold USD	$3.3 million	Hack VC, Array Ventures, Cantos Ventures, Neural Capital, Dave Samuel
Fragments (ERC20)	$3 million	True Ventures, Pantera, FBG Capital, Founder Collective, Brian Armstrong
Carbon USD	$2 million	General Catalyst, DCG, FirstMark Capital, Plug and Play Ventures, The Fund
StableUSD (ERC20)	$500,000	Beenext, 500 Startups
Circle USD (ERC20)	n/a	Bitmain, Blockchain Capital, Pantera, DCG and others
bitUSD	n/a	n/a

The stablecoin remains the Holy Grail of cryptocurrency, promising real stability and advancing payment systems built on smart contract platforms that can lead to mainstream adoption.