Solana Labs — the company behind the software that the Solana (CRYPTO: SOL) blockchain runs on — raised $314.15 million in a private token sale from investors, including Andreessen Horowitz's A16z and Polychain Capital.
What Happened: According to a Wednesday The Block report, other investors who took part in the funding round include Alameda Research, CMS Holdings, CoinShares, Jump Trading, Multicoin Capital, Sino Global Capital, and many others.
The news follows recent reports that Solana Labs was raising between $300 and $450 million to fund the development of new features meant to enable Solana to challenge Ethereum (CRYPTO: ETH).
Solana Labs plans to use the newly-raised capital to fund an incubator that will help speed up the development of Solana's blockchain ecosystem and set up a venture investing arm dedicated to projects that make use of the network.
The coin's price saw significant growth during the recent crypto boom as high fees and slow transactions on the Ethereum network caused market observers and participants to look for alternatives.
Solana transactions significantly cheaper than they are on Ethereum, on the order of a single cent, and fast, measured in seconds, while as of press time, Ethereum transactions cost $6 on average and take minutes.
Ethereum is currently home to the biggest decentralized finance (DeFi) ecosystem of the whole cryptocurrency universe, but the network hardly manages to make it work conveniently for its users.
Polychain Capital's managing partner Olaf Carlson-Wee said that Solana could "massively scale" the DeFi ecosystem and explained that the firm does not view it as a competitor to its older brother.
"In our view, Solana is a compliment to Ethereum," he said.
Price Action: Solana's price grew significantly since the announcement. According to CoinMarketCap data, the coin went up by over 19.5% from its 24-hour low of $36.75 to a high of $43.93. It was trading at $41.19.
Image: Courtesy of Solana
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