Galaxy Digital, IOSG Lead $1.2M Raise for Startup Creating Automated Ethereum Services
Gelato said the seed round will fund further development of its bot network that will provide automated smart contract execution.
A Berlin-based startup creating a tech stack for automated Ethereum services, has raised $1.2 million in a seed round led by Polkadot backer IOSG Ventures and crypto merchant bank Galaxy Digital.
- Gelato Network announced Tuesday the funding would go towards developing its network infrastructure as well as launching an decentralized autonomous organization (DAO) that will one day take over governance.
- Founded late last year, Gelato is building a product that adds the next stage to smart contracts, allowing Ethereum developers to automate contract execution on their dapps.
- While smart contracts execute functions once pre-defined conditions are met, most still require users to manually send the transaction itself.
- That can either introduce bottlenecks into the system if the user isn't online, or additional risk if a third party has to be trusted to execute the transaction when required.
- Having moved to a live mainnet offering in June, Gelato offers developers programmable bots – software that performs automated tasks online – that can be customized to execute specific transactions for selected smart contracts.
- While automated smart contract execution is already available, Gelato says this will be the first such product built entirely on a completely decentralized infrastructure.
- That means bots aren't programmed by just one team of developers and are, therefore, less at risk to a single point of failure.
- One use case for Gelato could be automating repayments on DeFi lending platforms, which makes the loan process seamless and faster, saving borrowers from paying unnecessary interest when they're not online.
- Seed round co-leader IOSG Ventures has invested in many of the industry's household names, such as Vechain, Dfinity, Lisk, Cosmos and Polkadot.
- Meanwhile, Galaxy Digital was a major stakeholder in alternative blockchain platform EOS – which it moved out of last year.
- The seed round also included commits from Gnosis; two venture DAOs, MetaCartel Ventures and The LAO; and Christoph Jentzsch, who was part of the team that created the original Ethereum DAO back in 2015.
- Part of the role of the seed investors is to help with the long-term sustainability of the Gelato DAO, which will ultimately allow Ethereum projects to coordinate and identify what services and functions should be automated.
- The DAO is scheduled to launch sometime in Q1 2021, Gelato "Legendary Member" Hilmar Orth told CoinDesk.
- It's unclear when Gelato anticipates launching its DAO. CoinDesk reached out to the team for comment but hadn't received a response by press time.
- In a statement, IOSG founding partner Jocy Lin said Gelato was, among other things, providing some of the "critical infrastructure" for the still-nascent DeFi space.
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