Cork Protocol secures $5.5M to create tokenized risk infrastructure for digital assets

Cork Protocol has secured $5.5 million in a seed round led by a16z's CSX startup fund and Road Capital, with additional investment from notable VC and crypto groups such as 432 Ventures and BitGo Ventures.

The funding will support the development of a "risk layer" for digital assets like stablecoins and onchain vaults.
Cork aims to introduce tokenized risk management infrastructure, responding to events like the eight major stablecoin depegs and a $19 billion flash crash in 2025.
This infrastructure will allow vendors to offer "cover tokens," serving as insurance against risk events, and enable users to purchase "depeg swaps" to protect against asset collapse.
Traders can utilize these tools to align onchain finance with traditional finance by shorting or longing assets.
The funding follows Cork Protocol's launch of "Phoenix," a decentralized risk management solution on Ethereum.