Hermetica, which operates the Bitcoin-backed stablecoin USDh, has raised $1.7 million in seed funding.
This funding will support the growth of USDh, a stablecoin designed to be backed by Bitcoin (BTC). A stablecoin is a type of cryptocurrency that aims to keep its value tied to a stable asset like the US dollar, rather than fluctuating like Bitcoin.
USDh allows Bitcoin holders to trade digital assets pegged to the value of the US dollar without leaving the Bitcoin ecosystem. For example, 1 USDh is equivalent to 1 USD worth of Bitcoin.
According to a company press release, UTXO Management led the funding round, with participation from several major investors including CMS Holdings, Ethos Fund, and Trust Machines SPV. Strategic backers such as Tycho Onnasch of Zest Protocol and Robin Obermaier of Liquidium also contributed.
What is USDh?
USDh is issued on Bitcoin’s main blockchain layer 1 and layer 2 networks, allowing for faster and cheaper transactions. Stablecoins can be purchased on decentralized exchanges
Last month, Hermetica launched USDh on its Stacks Layer 2 network. This move gave users the potential to earn up to 25% yield.
As the stablecoin market grows, USDh targets a share of the estimated $1 trillion of untapped Bitcoin value that could be unlocked in DeFi. Its goal is to allow Bitcoin market participants to safely hold their dollars without having to leave the Bitcoin ecosystem or exchange them for fiat currency.
