Web3 startup aPriori has successfully secured $20 million to enhance its trading infrastructure platform, which aims to integrate high-frequency trading (HFT) onchain and tackle both technical and market challenges within decentralized finance (DeFi). This funding round coincides with a growing interest among institutional investors in DeFi as a viable alternative for yield generation.
The financing included contributions from Pantera Capital, HashKey Capital, Primitive Ventures, IMC Trading, Gate Labs, and others, raising the total funding for the company to $30 million.
Founded in 2023, the San Francisco-based firm was established by former quantitative traders and engineers with backgrounds at Coinbase, Jump Trading, and Citadel Securities.
The aPriori platform aims to address various issues in onchain markets, such as wide spreads, miner extractable value (MEV) leakage, and toxic order flow. In traditional finance, toxic order flow refers to trading actions that pose adverse selection risks for market makers or liquidity providers.
Source: wenxue600
aPriori joins a rising cohort of startups focused on creating institutional-grade trading infrastructure onchain. Earlier this year, Theo secured $20 million from investors including Citadel, Jane Street, and JPMorgan to advance high-frequency trading and market-making strategies onchain.
Other platforms pursuing a similar strategy are Aevo (formerly Ribbon), which emphasizes derivatives and options infrastructure, the decentralized exchange dYdX, and Cega, which is crafting structured products for onchain markets.
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Institutional momentum toward onchain markets continues to grow
Positive regulatory changes, the perceived advantages of blockchain technology, and increasing yield possibilities in DeFi have prompted more institutions to enter onchain markets. This transition has heightened demand for institutional-level trading infrastructure.
Decentralized markets are also showing potential for yielding higher returns than traditional money markets, attracting yield-seeking institutional investors. For example, RWA.xyz reports that tokenized private credit markets currently yield an average annual percentage rate (APR) of 9.76%.
This segment of the tokenization market is estimated to be valued at around $15.6 billion, accounting for over half of all onchain tokenized activity.
Tokenized private credit market metrics. Source: RWA.xyz
Simultaneously, large institutions are exploring crypto-aligned strategies. For instance, JPMorgan Asset Management recently allocated up to $500 million to Numerai, an AI-focused hedge fund that crowdsources trading models.
Numerai, which launched one of the earliest native tokens in 2017, illustrates the merging paths of quantitative finance and blockchain technology.
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