Chris Larsen, co-founder of Ripple, has led a $10 million seed funding round for Yellow Network, a new decentralized clearing network that aims to address cryptocurrency inefficiencies.
The investment by the Ripple co-founder will support efforts to solve the digital asset market’s liquidity fragmentation, scalability, and capital efficiency issues.
“Other notable backers and supporters include Consensys, GSR, NxGen, MV Global, Gate Labs, ZBS Capital, Moonrock Capital, Math, Cobo, NOIA Capital, and LD Capital.”
Crypto trading inefficiencies
A press release shared with Cointelegraph states that Yellow Network’s decentralized clearing protocol is designed to “address critical industry challenges.”
“The chain-agnostic network is built on state channel technology and provides capital efficiency, reduced latency, and scalability for the ever-growing digital asset market.”
Discussing the investment, Larsen stated that the protocol is “essential” for newcomers and offers a “game-changer” solution due to its “fast trade execution and capital efficiency.”
Understanding decentralized clearing
Decentralized clearing involves bypassing centralized intermediaries or a clearinghouse to settle a financial transaction between parties — eliminating a middleman from the process.
This function is managed on the blockchain or through smart contracts and typically involves preserving privacy and removing central authorities seen in traditional financial systems.
The caveat to this system is the tradeoff between decentralization and regulated, centralized alternatives — the latter often featuring more consumer protective measures.
Ripple co-founder endorses Kamala Harris
As the news outlet CNBC reported on Sept. 6, Larsen signed a letter endorsing Vice President Kamala Harris for president alongside 87 other corporate leaders in the United States.
According to the CNBC report, the 88 US corporate leaders included 21st Century Fox CEO James Murdoch and Snap chairman Michael Lynton, among others.
The news followed the departure of former Ripple board member Gene Sperling from the White House in early August to join Kamala Harris’ 2024 presidential campaign.
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