Rich Quick? $5M for New Crypto Token!

by

A Spot of Bother:

  • Neutrl, a name that sounds suspiciously like a sneeze, has managed to snag a cool $5 million. Apparently, the plan is to democratize the sort of crypto shenanigans usually reserved for hedge fund types. One shudders to think. 😲
  • Inspired, they say, by Ethena’s success. One can only hope they’ve also invested in a good accountant. Their NUSD sounds like something one might find lurking in a chemistry lab. 🧪
  • Backed by STIX, Accomplice, and crypto veterans, Neutrl is eyeing a $10 billion market of locked token deals. One imagines this involves complicated charts, spreadsheets, and a fair bit of nail-biting. 😬

Novel decentralized finance (DeFi) protocol Neutrl—yes, I nearly sneezed again—aims to bring a hedge fund trade (once limited to the sort of chap who wears a monocle and understands things like “derivatives”) to the masses in the form of a crypto token. One can only imagine the chaos that will ensue. 🤣

The protocol, with all the pomp and circumstance of a particularly enthusiastic butler, is launching its NUSD “synthetic dollar” token. It’s designed to generate returns by arbitraging discounted altcoin deals in over-the-counter (OTC) markets, or so the team breathlessly informed CoinDesk in an exclusive interview. One assumes they served tea and biscuits.

Neutral also raised $5 million in seed funding led by digital asset private marketplace STIX and venture firm Accomplice. They were joined by Amber Group, SCB Limited, Figment Capital and Nascent alongside a range of crypto angel investors including Ethena founder Guy Young and derivatives trader Joshua Lim of Arbelos Markets, recently acquired by FalconX. A veritable who’s who of people I’ve never heard of, but one wishes them the best, naturally. 😇

Tokenized hedge fund strategy

Neutrl is the latest entrant to the rapidly growing roster of protocols that offer hedge fund-like investment strategies wrapped into a token with a stable price, often called “synthetic dollar.” $6 billion DeFi protocol Ethena spearheaded the trend, offering yield to token holders via holding spot cryptos and shorting perpetual futures, farming the funding rate. One hopes they have a good scarecrow to keep the bugs away from their yield farm. 🚜

Neutrl’s structure is built around buying locked altcoins at discounts in private markets, then hedging exposure with perpetual futures. For example, a trader might acquire Solana’s SOL or Avalanche’s AVAX at a 20% discount from a foundation and simultaneously open a short position for the token. The return comes from the price gap, not market movement. Sounds frightfully complicated, doesn’t it? 🤔

This is a popular hedge fund investment strategy producing high double-digit yields to sophisticated investors who don’t want to take directional bets on crypto prices, Neutrl co-founder Behrin Naidoo explained in an interview. One imagines they’re all frightfully busy counting their winnings. 💰

But, instead of managing these trades manually, Neutral users can hold a single token—NUSD—that encapsulates the strategy, opening access to a broader set of investors, he said. One wonders if this means more chaps in bowler hats getting involved. 🧐

With a flood of altcoin unlocks over the next few years, Neutral estimates that there’s a $10 billion market for locked up tokens. This offers an attractive yield opportunity for investors, especially now when crypto yields in decentralized finance compressed to multi-year lows, Naidoo said. One trusts they’ve accounted for the possibility of things going a bit pear-shaped. 🍐

Neutrl is targeting to grow to $2 billion in assets in the two years, he added. One wishes them the best of luck, and hopes they don’t end up needing a stiff drink. 🍸

Read More

2025-04-16 18:28