UNION, a defi risk management firm, raised $3.9 million in a funding round, which drew participation from several crypto trading companies and venture capital firms. Some of the key firms that led the funding round include 3 Commas, Solidity Ventures, AAM, Spark Digital Capital, Alameda Research, Black Edge Capital, and Alpha Chain.

Decentralized finance was slated to become the success story of 2020 for the crypto world; however, the defi ecosystem has started to show the vulnerabilities which many analysts predicted earlier. In recent times, there have been reports of several defi projects cropping up within weeks and managed to create a market cap of tens of millions of dollars just because of the hype surrounding defi.

The popularity also led to several scam tokens and platforms. With the rising vulnerabilities and risks in the defi market, Union comes in as a safeguard against some of the most common risks associated with defi these days. Those risks include glitchy smart contracts, overexposure to an asset, layer 1 risk (entire protocol fails), impermanent loss (specific to liquidity providers), and collateralization risk.

UNION is looking to cover all the risks associated with the defi space and believe a complete package like theirs is more economical and secure than insurance against individual risks. Union co-founder Michael Beck believes that security and protection for customers are necessary to scale the ecosystem further. He said,

“As DeFi is still growing, it would be disingenuous of anyone to state that they ‘know all the risks’ of Defi.”

Beck noted that such a mechanism “is necessary for DeFi protection to scale with DeFi itself.” He added,

“No one can guarantee what regulators will do, but as of right now, where people can use DeFI, they can use our protection tools.”

The post Decentralized Finance Firm, UNION, Raises .9M to Expand Risk Management Protection first appeared on BitcoinExchangeGuide.

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