Web3 Protocol Polytrade Bags Funding To Integrate DeFi With Traditional Finance

Web3 protocol Polytrade has raised $3.8 Mn in a seed round led by Alpha Wave, Matrix Partners, Polygon Ventures and CoinSwitch Ventures. The round also saw the participation of Singularity Ventures, GTM Ventures and other notable angels.

Polytrade intends to utilise the raised funds to grow its product suite, concentrate on the marketing and enter other markets in Latin America and Europe. Further, in the next two quarters, the startup plans to focus on bringing a fully integrated trade platform.

Including the current round, it has raised $5 Mn in funding, having raised $1.2 Mn in its initial coin offering.

Founded in 2021 by Piyush Gupta, Polytrade offers SMEs and manufacturers capital based on their blue-chip receivables.

The initial modules on Polytrade include a financial arm, which allows SMEs to access working capital financing against their invoices and allows lenders to receive strong yields through safe and insured invoices. It has already raised more than $11 Mn in the decentralised finance (DeFi) liquidity and traditional credit facilities.

Speaking on the announcement, Gupta said “We understand where the problems lie as well as the real-world impact web3 can bring. I also firmly believe that with Polytrade, we will make trade finance one of the most preferred asset classes for investors given its relative safety coupled with robust yields.”

The platform has a full-stack approach to RWAs, including originating, underwriting, taking insurance and collecting on behalf of its investors. The platform also publishes its proof of trade, which certifies that Polytrade holds the custody of the underlying collateral for each pool and that no third party is involved, ensuring the safety of funds.

Incidentally, businesses can also borrow capital against their stablecoin holdings on Polytrade. The startup said it is launching a ZK-ID on-chain identification system, which will improve the creditworthiness of suppliers and buyers. This method will allow for quick and secure identity verification, lowering the risk of fraudulent transactions.

Sandeep Nailwal, cofounder and CEO of Polygon, added, “Polytrade’s integration of DeFi with traditional finance represents a much-anticipated step forward in the evolution of the financial landscape. Given our long-standing relationship with the team, I am convinced that their unwavering dedication to real-world assets and DeFi will prove to be a transformative force for the web3 ecosystem and drive widespread adoption.”

India’s web3 ecosystem is fast becoming one of the most lucrative in the world. Despite being in its nascent stages, the country’s Web3 ecosystem fosters 11% of the world’s Web3 talent, employing nearly 75,000 people, and housing 450 Web3 startups, according to a NASSCOM report.

Last month, Graviton, a web3 accelerator programme, announced that it would select up to 10 web3 startups for its 16-week accelerator programme.