- Monolith turned a $16.9 million ICO into $25 million-worth of assets by riding the bull market of 2017 then taking out DAI loans.
- This DAI strategy is increasingly common among ethereum-centric startups.
- MakerDAO and Monolith are now collaborating to connect DeFi loans to a European Visa debit card.
- Ether fans can spend crypto with a Visa debit card because Monolith liquidates designated funds on the back-end, providing the merchant with fiat.
Monolith CEO Mel Gelderman told CoinDesk he wants to promote an “ethereum lifestyle,” starting with the way he runs his London-based token startup.
From his perspective, that lifestyle is about seeking financial solutions beyond traditional banks.
Since Monolith was funded by an initial coin offering (ICO) of TKN tokens that raised $16.9 million from retail investors in May 2017, Gelderman said his team turned the ICO proceeds into roughly $25 million worth of assets through prudent trading and collateralized debt positions (CDPs), using ether as collateral to take loans denominated in dollar-pegged DAI tokens.
“We’ve started to use the MakerDAO platform to hedge instead of selling our ether,” Gelderman said. “We’re deploying the economy itself to get [our goals].”
While a slew of ICO-funded startups ran out of steam in 2018 when the price of ether crashed, Monolith’s strategy provided the startup with plenty of runway.
The startup’s current assets include 80,000 ether (about $14.6 million) and a $10 million treasury of both 16 million TKN and approximately $3 million in fiat holdings. Lately, Monolith stopped trading and started collateralizing ether for DAI loans instead. And Gelderman is hardly the only entrepreneur taking this road.