COTI has received $500,000 from cFund, marking the first investment made by the venture fund backed by Cardano, the network behind the current seventh-largest cryptocurrency by market capitalization.

The $20 million cFund was launched in July of last year, a joint venture between Cardano builder IOHK and Los Angeles-based Wave Financial. The aim of the fund is to grow the Cardano ecosystem, which has not kept pace with the whopping growth of its native ADA token.

Both teams have worked together in the past, resulting in COTI creating the first version of ADA Pay in 2019. COTI will upgrade that for the Shelley mainnet, expected to be released on the Cardano network over the coming weeks, said COTI CEO Shahaf Bar-Geffen.

The cryptocurrency space can be thought of as a collection of tribal factions with fiercely held allegiances. Cardano and ADA, created by Ethereum co-founder Charles Hoskinson, stands outside the crypto canon and has endured ribbing from Bitcoin and Ethereum supporters alike who claim nothing much is really being built on Cardano.  

“There are a lot of new chains out there like Polkadot and Binance Smart Chain and so on, and they all more or less target the same crypto audience to do DeFi better and all of that,” Bar-Geffen said, referring to the $51 billion decentralized finance sector. “Rather than just doing just another faster or better version of Ethereum with the same DeFi projects on top, Cardano is trying to work with governments, specifically in developing countries in Africa and South America.”

For his part, IOHK’s Hoskinson said in a statement that the COTI investment is a step towards deepening the relationship between the projects. 

“COTI has been a great partner across several projects already, and we plan to leverage their advanced fintech architecture to enable future finance applications on ADA,” Hoskinson said.