VanEck, known for its Bitcoin exchange-traded fund (ETF), will manage the reserve fund for the innovative stablecoin initiative called Agora Dollar (AUSD).

Agora Dollar raised $12 million in funding, led by crypto venture fund Dragonfly. The project was founded by Nick Van Eck, collaborating with Drake Evans and Joe McGrady.

VanEck, which recently launched an approved Bitcoin ETF called HODL in the US, will be responsible for overseeing the reserve fund. The HODL fund has garnered $586 million in assets under management since its inception.

Agora Dollar Overview

AUSD is a fiat-backed stablecoin that aims to disrupt the market with its focus on a "customer-first perspective within a compliant framework."

Agora emphasizes the importance of treating digital dollars as public goods and redistributing revenue back into the ecosystem, especially to those contributing utility and liquidity.

While prioritizing regulatory compliance and seeking licenses where necessary, Agora's services are currently limited to specific markets outside the United States.

The project revealed that its reserve fund will be managed by one of the world's largest custodians and will maintain assets securely, held in trust and subject to regular audits.

Growing Stablecoin Market

Agora's entrance into the stablecoin sector coincides with a positive trend, with major financial entities like PayPal and DeFi projects such as Aave and Ethena showing interest.

The stablecoin market has seen a 15% year-to-date increase in total market capitalization to approximately $150 billion, the highest level since FTX's crash in November 2022.

Tether's USDT remains the dominant asset, controlling over 69% of the market with continued expansion to new blockchain networks. Its market capitalization now stands at around $104 billion.

Additionally, Circle's USDC has experienced significant growth during the year's first quarter, increasing its supply by 22% to $32.7 billion, the highest among major stablecoin issuers.

Newcomers like Ethena's USDe synthetic dollar have attracted attention due to their yield model, adding diversity to the stablecoin landscape.