Hong Kong decentralized finance startup banks $3.3m in strategic sale round

Hong Kong’s Formation.Fi, a startup that simplifies the creation of decentralized finance (DeFi) portfolios and helps users better manage risk, said it has closed US$3.3 million in a strategic sale round.

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The investment saw participation from DeFi protocol founders such as those of Bancor, Synthetix, and Polygon, according to a statement. VC funds including Kenetic, Kosmos, Spark Digital Capital, AU21 Capital, X21 Digital, Momentum 6, Genblock Capital, GBV Capital, Shima Capital, and Brilliance Ventures also took part in the round.

With the new funds, Formation.Fi plans to accelerate the development of its risk parity protocol, a chain-agnostic yield-management platform that goes by the principles of the risk parity movement adopted by Wall Street hedge funds.

With this platform, which uses what the company has dubbed Smart Farming 2.0, users get to tailor their level of exposure while being guided by the risk protocol. When a user sets a level of risk, the protocol automatically configures and recommends a compatible portfolio of yield-farming strategies.

The technology would give first-time investors a simpler way to participate and earn, the startup said.

“With our founders’ club approach, we are focused on coming together to build and amplify this still-experimental ecosystem and evangelize Smart Yield Farming into the world of open finance,” said Formation.Fi co-founder Kristof Gagacki.