Bain Capital Crypto leads $35 million Series A in stablecoin mining protocol M^0.
M^0 (pronounced “M Zero”), a decentralized stablecoin mining protocol, has raised $35 million in a Series A funding round led by Bain Capital Crypto.
Other investors in the round included Galaxy Ventures, Wintermute Ventures, GSR, Caladan and SCB 10X, M^0 said Wednesday. M^0 Foundation Council President Luca Prosperi told The Block that the project began fundraising in late January and closed in early May.
The round consisted of shares and tokens, with M^0 issuing two “governance tokens” (POWER and ZERO) to investors on a fixed-term basis, Prosperi said. He added that this lockdown period was in line with “prudent business and regulatory practices.” He declined to comment on valuation.
M^0’s Series A round comes just over a year after it raised $22.5 million in a seed funding round led by Pantera Capital in April 2023. The Series A round brings M^0’s total funding to $57.5 million. Prosperi noted that demand for the Series A round was 2.5 times the amount raised.
What is M^0?
M^0 is an Ethereum-based stablecoin minting protocol that allows authorized entities to create a stablecoin called M that is “overcollateralized only by U.S. Treasury securities.” To issue M, an entity needs permission from protocol governance. Once approved, we provide our own standardized, “high-quality” collateral, which independent validators check to ensure it meets our standards.
The M^0 protocol has been deployed on the Ethereum mainnet and will be launched in the coming weeks, Prosperi said. The first miners and validators have also been approved, with further details to be released later.
“Any company can request to become a miner with a permit, but it requires approval from governance,” Prosperi said. He added that companies must also comply with the “adopted guidelines” of M^0, which will be released soon.
Prosperi noted that other stablecoin issuers such as Agora and Mountain could also join the protocol and issue M according to the M^0 standard. “M^0 is really a network that can connect all compatible issuers,” he said.
Reserves of the M stablecoin should be held in a bankruptcy-remote vehicle managed by a special-purpose vehicle operator that is separate from the miner, Prosperi said. He added that these reserves will be verified and published daily by approved verifiers of the M^0 system.
M^0 launch
The M^0 protocol will initially launch on Ethereum, but Prosperi said the M stablecoin will eventually become available on other layer 1 and layer 2 networks. The M^0 team is currently researching multichain strategies. The team is led by former MakerDAO and Circle employees.
M^0 currently has more than 50 employees, and Prosperi is looking to expand the team across a variety of functions, including engineering, legal, business development and operations.
As part of the Series A round, Bain Capital Crypto took a board seat at M^0, along with Pantera Capital, Road Capital and AirTree, Prosperi said.
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