Quick take:
- The latest funding brings the total funding to $24 million, including seed funding.
- The cross-chain yield optimization protocol plans to expand to more blockchains and upgrade its core infrastructure.
- YO optimizes yield by targeting the best risk-adjusted returns across several assets and chains, including USD, EUR, BTC, ETH, as well as gold.
YO Labs, the team behind the cross-chain yield optimization platform, YO Protocol, has raised $10 million in a Series A round led by Foundation Capital. The fundraising also attracted participation from Coinbase Ventures, Scribble Ventures, and Launchpad Capital.
YO Labs has now raised $24 million in total, including a $14 million seed round announced in October 2022, before its rebranding from Exponential to YO Labs. Paradigm led the seed round with participation from Haun Ventures, FTX Ventures, Polygon, and Solana Ventures, among others.
YO Labs offers a yield optimization solution that targets the best risk-adjusted returns across several assets and chains, including USD, EUR, BTC, ETH, as well as gold.
The company plans to use the fresh capital to scale its platform, including expanding to more blockchains and upgrading its core infrastructure.
Commenting on the announcement, YO Labs co-founder and CIO, Mehdi Lebbar, told CoinDesk that the platform’s core innovation lies in the way it calculates risk-adjusted yield. Rather than targeting the highest yield, YO Protocol incorporates multiple risk factors, including the protocol’s age and its code audit history, in the model to determine the probability of default.
The protocol has also adopted a unique architecture dubbed “embassies” and described as independent vaults holding native assets on each blockchain, to minimize reliance on bridges, thus reducing the risks associated with moving assets across bridges.
“If you bridge a pool, you have exposure to the risk of the bridge. We needed to create these ’embassies’ across multiple planets, these vaults across multiple chains that hold native assets,” Lebbar told CoinDesk. “If you have USDC on Arbitrum, that is the same USDC as on Ethereum, and you no longer have the bridge in the middle, that’s much safer.”
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