OpenTrade raised another $7 million, led by Notion Capital and Mercury Fund, with a full lineup from a16z crypto, AlbionVC, and CMCC Global.

OpenTrade aims to bring traditional financial institutions onto the blockchain investment train, especially in the area related to stablecoins.

Their own claim is to provide secure, transparent, and compliant yield channels, sounding like a fusion of traditional financial wealth management tools and DeFi.

But what I personally care about is two words: yield.

In the past year, many on-chain yield platforms have been scamming people.

Either they have run away or are playing tricks, like suddenly offering annualized rates of two or three hundred percent, only for you to end up with a failed stablecoin as a souvenir.

What OpenTrade focuses on is real off-chain yields and transparent on-chain settlement.

It does not attract users by issuing tokens, pump-and-dump schemes, or airdrops, but is linked to real-world credit and bonds, such as on-chain structured credit products.

This approach is somewhat similar to MakerDAO and Maple Finance, but OpenTrade emphasizes compliance and low-volatility yields more.

Let me show you some data:

According to a Messari report, by the end of 2024, the total market capitalization of stablecoins is close to $160 billion, with over 70% in a non-yield state.

In the TradFi world, the annualized yield on global short-term government bonds and corporate bonds fluctuated in the range of 3%-6% in 2023, and these assets are exactly the typical subjects that can be brought onto the blockchain.

If OpenTrade can capture even 1% of the market share, that would mean a potential custody asset scale of $1.6 billion. Calculating with the industry average management fee rate of 1.5%-2%, making tens of millions of dollars in a year is not a dream.

This round of financing indicates that institutions are optimistic about the certainty of stable yields and compliance routes, rather than betting on the volatility of a bull market.

Of course, this also depends on regulatory trends. Recently, the UK and EU's attitude towards crypto has leaned towards controlled openness, which presents both opportunities and challenges for OpenTrade.

If it can scale up in the UK, it is not impossible to target the US and Asian markets in the future.