Nick van Eck, son of investment guru Jan van Eck, is gearing up to unveil a new stablecoin backed by the United States dollar following the closure of a $12 million funding round.

In collaboration with crypto veterans Drake Evans and Joe McGrady, van Eck launched Agora in October, which will introduce the Agora digital dollar under the ticker AUSD, as reported by Bloomberg on April 2. Nick van Eck will assume the role of CEO. AUSD will be backed by cash, U.S. Treasury bills, and overnight repo agreements, with VanEck, a $90 billion asset management firm led by Jan van Eck, managing a fund for Agora’s reserves.

According to VanEck's director of digital assets Kyle DaCrzu, there is a demand for transparent and reliable institutions to manage the assets of digital dollars. The $12 million seed funding was spearheaded by digital asset VC firm Dragonfly, with contributions from Robot Ventures, Wintermute, Breed, and General Catalyst, where van Eck previously served as a partner.

Evans previously held the position of head of lending at decentralized finance firm Frax Finance, while McGrady was the director of operations at digital asset management firm Galaxy Digital. Agora's parent company is registered in Delaware, with its stablecoin issuer located in the British Virgin Islands.

Initially, it will cater to selected markets outside the U.S. Van Eck explained that until there is federal legislation for stablecoins in the U.S., the focus will primarily be on non-U.S. customers. Agora anticipates that regions such as Argentina and Southeast Asia will reap significant benefits from a digital dollar.

Agora will face stiff competition in the stablecoin market, dominated by Tether (USDT) and Circle (USDC), which have market caps of $104.3 billion and $32.5 billion, respectively, according to CoinGecko.

However, van Eck believes there is still space for a newcomer, and Agora aims to forge strong partnerships across the industry. Unlike TerraClassicUSD (USTC), AUSD holders will not receive income, following USTC's collapse in May 2022. Van Eck emphasized the importance of restoring the industry's reputation and advancing it with Agora. As of now, Agora has not responded to requests for comment.