Zoo Finance's $8M Raise Aims to Free Trapped DeFi Capital

Zoo Finance, a decentralized finance (DeFi) protocol focused on unlocking liquidity from locked vesting tokens, has completed an $8 million strategic fundraising round, bringing its total capital raised to $10 million. The round was led by Bitrise Capital, with participation from Signum Capital, Certik Ventures, TOP, CGV Funds, and Cryptomeria Capital [according to reports]. This follows earlier investments from CMS Holdings, Big Brain Holdings, and other entities, underscoring growing institutional interest in protocols addressing token liquidity challenges.

The protocol's core innovation lies in its Liquid Vesting Token (LVT) and Liquid Node Token (LNT) framework, which splits locked vesting tokens into Vesting Tokens (VT) and Yield Tokens (YT). This mechanism enables on-chain over-the-counter trading for projects like Filecoin, Aethir, and 0G, while supporting restaking via platforms such as Symbiotics and Eigencloud. By converting illiquid positions into tradable assets, Zoo Finance aims to capture the time-value of locked capital, a critical pain point in the crypto ecosystem. Total Value Locked (TVL) in the protocol has grown steadily, reflecting adoption across multiple blockchain networks.

Marshall Chang, co-founder and CEO of Zoo Finance, emphasized the protocol's role in transforming underutilized capital. "Our solution maintains the integrity of original vesting structures while activating dormant assets," he stated, highlighting the potential for yield trading and expanded use cases with future tokens [according to the protocol's whitepaper]. The $8 million infusion will accelerate expansion into new blockchain ecosystems and enhance protocol functionality, including the development of LVT and LNT vaults.

The fundraising aligns with broader trends in DeFi, where protocols are increasingly addressing inefficiencies in token utility. With the rise of institutional-grade tools and regulatory clarity in select markets, projects like Zoo Finance are positioning themselves to bridge the gap between traditional finance and decentralized ecosystems. As the crypto market evolves, liquidity solutions for locked assets are expected to play a pivotal role in unlocking broader adoption and capital efficiency.