Venture funds Dragonfly Capital and Paradigm have acquired $27.5 million worth of MKR tokens and plan to take part in the Maker Protocol’s governance system.

Announced Thursday by the Maker Foundation, the $27.5 million raised will fund the foundation’s efforts to promote dai adoption in China and the broader Asia region. It’s expected Dragonfly and Paradigm, who already have a strong presence in the region, will advise on the expansion.

“Dai continues to be the stablecoin of choice in all global markets for its decentralization and overall stability,” said Rune Christensen, CEO of the Maker Foundation, in a statement. “The support and expertise of Dragonfly Partners and Paradigm will give Dai an unparalleled advantage in driving innovation and adoption in Asia.”

The joint purchase means Dragonfly and Paradigm now control approximately 5.5 percent of the total MKR token supply. Combined, the acquisition makes Dragonfly and Paradigm the second-largest private holder of MKR tokens. VC firm Andreessen Horowitz remains the single largest private holder with the 6 percent stake it acquired in September 2018.

Dragonfly and Paradigm intend to play an active role in maker’s onchain governance. This will include participating in executive votes – the process that approves proposals that determine the ecosystem’s direction.

Stakeholders recently participated in one such vote to ratify the Foundation’s multi-collateral dai proposal in mid-November before it could be implemented.

Both Dragonfly and Paradigm will operate their own stakes independently of one another. It is uncertain yet whether one VC has acquired a larger share of maker tokens than the other. A Foundation spokesperson declined to comment.

The price of MKR jumped 3 percent on the announcement, according to data from CoinMarketCap.

The MakerDAO ecosystem is the market leader in decentralized finance. Nearly $320 million worth of assets are already locked in dai smart contracts, according to DeFi Pulse. In comparison, the second-largest protocol, derivatives provider Synthetix, currently has just under $168 million locked in smart contracts.

In a statement, Dragonfly Capital managing partner Alexander Pack said, “Asia is the most important market for crypto in general. It is also home to the largest concentration of the unbanked and underbanked around the globe, which we believe represents an enormous pent-up demand for decentralized financial products.”

Both VCs focus on investing in the cryptocurrency space. Dragonfly participated in the seed round for ethereum scaling solution Matter Labs. Among other things, Paradigm has invested in a startup building a lightweight blockchain, known as Coda.

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