Sommelier raises £16.7m in Series A funding for automated DeFi protocol

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Sommelier Finance, the Ethereum-based project designed to automate decentralised finance (DeFi) trading, has raised £16.7 million in its Series A funding round.

The round was led by Polychain Capital with participation from existing investor Alameda Ventures and new participation from Zola Ventures, Byzantine Ventures, Tendermint Ventures, Secure Ventures, D1 Ventures, and Ferngrove Ventures.

Sommelier was founded in 2020 by Zaki Manian, the former lead developer of Cosmos and Tendermint. It describes itself as a “decentralised and automated DeFi portfolio manager software”.

What this means in practice is that Sommelier acts as a co-processor for Ethereum’s Virtual Machine, giving liquidity providers the power to automate their capital allocation for maximum yields.

The company plans to use its newfound funding to upgrade network software and launch Sommelier Cellars – community-voted strategies that Sommelier validators execute to manage capital movement across blockchains.

Zaki Manian, co-founder of Sommelier, said: “Sommelier is bringing the promise of the Cosmos blockchain and Tendermint consensus to power a new approach to financial engineering and portfolio management.

Over the past decade, we’ve seen incredible decentralised foundations built as a number of blockchain platforms have emerged with numerous use cases, and we’re excited to use this funding to tap the potential of blockchains to create automated portfolio management tools that surpass even what’s possible in traditional, centralised finance.”

In the six months since launching its Uniswap V3 liquidity manager, Sommelier has helped liquidity providers place over £7.2 million in liquidity on Uniswap V3, generating more than £1.4 million in fees for portfolio owners.

As the project develops, Sommelier plans to support more liquidity pools across Ethereum-compatible blockchains and Layer 2 networks.

The company’s total funding to date now sits at £19.1 million following a £2.4 million seed funding round in March 2021.

Want to learn more from executives at the heart of this space? The Blockchain IoT Solutions Congress, on November 2 2021, will explore the convergence of these two technologies and the use cases and industries that will benefit.

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