Key Takeaways
- AUSD to be fully backed by cash, U.S. Treasury bills, and overnight repo agreements
- Dragonfly led the $12M seed funding for Agora, with Robot Ventures, Wintermute, Breed, and General Catalyst joining as investors
Nick van Eck, son of Jan van Eck, the CEO of VanEck, a prominent $90 billion asset management firm, is set to launch a new stablecoin named Agora digital dollar (AUSD). The initiative follows a successful $12 million funding round aimed at establishing a foothold in the competitive stablecoin market.
Agora’s focus lies on transparency and trust in managing digital dollar assets, aiming to cater exclusively to non-U.S. users initially.“Until there’s federal legislation for stablecoins in the U.S., we’re going to focus primarily on customers outside of the U.S.,” the official press release reads.
Operating under a Delaware incorporation with its stablecoin issuer headquartered in the British Virgin Islands, Agora pledges to ensure transparency and reliability in managing its reserves. The stablecoin will be fully backed by a combination of cash, U.S. Treasury bills, and overnight repo agreements, managed by VanEck to uphold the stability of its value.
The seed funding round, totaling $12 million, was spearheaded by digital asset venture capital firm Dragonfly. Other contributors include Robot Ventures, Wintermute, Breed, and General Catalyst. The Agora team comprises experienced professionals in the crypto realm, including Drake Evans and Joe McGrady, who bring their expertise from Frax Finance and Galaxy Digital, respectively.
AUSD’s backing with secure and liquid assets aims to instil confidence among users, ensuring a solid foundation for its value. As federal legislation for stablecoins in the U.S. remains pending, Agora opts to focus primarily on non-U.S. customers.
VanEck’s Director of Digital Assets Product, Kyle DaCruz, stresses the importance of transparent and trustworthy management of digital dollar assets.“There is a need to have transparent and trustworthy institutions managing the assets of these digital dollars”.
Despite the dominance of existing stablecoin issuers like Tether (USDT) and Circle (USDC), with market caps of $104.3 billion and $32.5 billion respectively, van Eck believes there’s room for a new entrant. Agora plans to engage institutional clients and partners globally, prioritizing markets like Argentina and Southeast Asia where stablecoins could have a significant impact.
A recent report by Bitso has pointed out that Argentina had the largest purchases and holdings of stablecoins in Latin America over the past six months.
