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Fang Shihan · · 4 min readBluejay looks to raise $5m to mint SG stablecoins
Bluejay Finance, a multicurrency stablecoin issuer, is raising US$5 million from the sale of its governance token blu. The funds will be used to mint Bluejay’s first stablecoin, bluSGD, pegged to the Singapore dollar.
The funds will also be used for market making bluSGD on decentralized exchange Uniswap.
Image credit: Tech in Asia
This is Bluejay’s second fundraising round. It had scooped up $2.9 million in its seed round via fiat money and tokens in July this year.
The company is selling one blu, its governance token, for 10 dai, an algorithmic stablecoin pegged to the US dollar.
Investors that participated in Bluejay’s testnet – a simulation of the actual system – can purchase a limited amount blu at a discounted price of 5 dai.
Holders of Blu can use it to vote on protocol initiatives or stake tokens to earn rewards.
Blu/dai is currently the only available trading pair. The company declined to comment on whether institutional investors have been lined up for this fundraising round.
Maintaining multicurrency pegs
As one of the first Asia-focused stablecoin issuers, Bluejay competes with StraitsX, which operates XSGD and XIDR. However, both companies maintain their fiat pegs differently.
StraitsX maintains full-reserve stablecoins. This means that the company’s stablecoins are backed by their respective fiat currencies, the Singapore dollar and Indonesian rupiah, held at licensed financial institutions.
In contrast, Bluejay maintains algorithmic stablecoins backed by dai.
The company’s founder and CEO, Sherry Jiang, says that while bluSGD is an algorithmic stablecoin, it should not be compared with TerraUSD (UST), the infamous US-pegged stablecoin issued by Terra that imploded in May.
Sherry Jiang, Bluejay Finance founder and CEO / Photo credit: Sherry Jiang
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The multicurrency stablecoin issuer has been testing its currency-pegging mechanism for six months and is confident the system is good to go.
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