Crypto fund a16z, a subsidiary of the venture capital firm Andreessen Horowitz, invested $15 million to buy 6% of the total supply of MakerDAO’s tokens. The ownership of the digital asset, with the ticker MRK, will give a16z a governance stake in the Dai Credit System, which claims to be the first decentralized autonomous stablecoin entity.
MakerDAO operates two tokens – MKR and Dai. The latter is a stablecoin backed by US dollars at a 1:1 ratio. Today, stablecoins represent a good method to hedge amid a volatile market like the crypto industry. It helps exchange operators with no banking access ensure a sufficient liquidity level.
Besides the token purchase by a16z, MakerDAO secured $12 million in an earlier round led by Andreessen Horowitz and Polychain Capital last year.
The acquisition of MKR tokens is the first investment for the newly created a16z crypto fund, which has capital of about $300 million. In June of this year, we reported that Andreessen Horowitz had launched the fund to get exposure to the crypto market. The investment in MakerDao was driven by general partner Katie Haun, a former US federal prosecutor who ran the investigations into Silk Road and the Mt.Gox hack. She commented:
“As a first mover and innovator in stablecoins, MakerDAO represents a very compelling opportunity in the crypto space. MakerDAO’s technology, ecosystem and talent have put theory into action to deliver a decentralized stablecoin that we believe will help drive the future of the crypto economy.”
According to the agreement, MakerDAO will receive operating capital over the next three years and full support from the a16z team, which currently comprises about 100 persons. The parties will focus on Dai adoption and regulatory integration. Also, the VC firm and its subsidiary will contribute with their expertise in areas like sales and business development, HR operations, and marketing among others.
MakerDAO CEO and co-founder Rune Christensen noted:
“a16z crypto shares our vision for a world where the blockchain has leveled the economic playing field for everybody. With investment and operational support from a16z crypto, MakerDAO will be able to accelerate evolution, innovation, and adoption of the Dai Credit System.”
Maker is a Decentralized Autonomous Organization developed on top of Ethereum. CEO Rune Christensen explained the company’s plans in an exclusive interview with Cryptovest.