Ukrainian cryptocurrency startup with 8 developers receives $ 2 million investment

The developers of the Ukrainian startup Kolibrio have managed to attract $ 2 million in investments to launch an automated online auction system that can monetize the process of placing orders for the purchase and sale of cryptocurrencies (on-chain order flow auction system or OFA). As co-founders Alex Starikov and Anatoliy Padenko told AIN, Jump Crypto Fund became the lead investor, and Delta Blockchain Fund, Everstake Capital, and English investors also participated in the funding round.Currently, the startup team consists of 8 developers, most of whom live in Kyiv on a permanent basis, so in addition to the usual investor risks when investing in a new project, the issue of the war in Ukraine arose. However, according to Starikov and Padenko, although investors paid attention to this risk, it did not become the basis for their decision. Investors analyzed the startup’s team, the expertise of the developers, and the technologies they were working on implementing. «We have never raided money, we were green in this matter. However, we communicated a lot, took the issue seriously and prepared, plus we had a lot of help from many advisors, one fund recommended another, and that’s how we found our existing investors through word of mouth,» Anatoliy Padenko emphasized. According to the developers, the automated online auction system for monetizing the process of placing orders for the purchase and sale of cryptocurrencies is similar to the Payment-for-order-flow (PFOF) mechanism from traditional financial markets. In PFOF, a broker gives an order to a market maker to fulfill a client’s request. «Take, for example, the process of selling or buying cryptocurrency on a decentralized exchange. If a trader places an order on a protocol such as Uniswap, certain types of transactions can create opportunities for additional trading. If there is such an opportunity to make money during a transaction, our service transfers the transaction to people or teams that use algorithmic trading strategies and allow them to fulfill the user’s request while making a profit from the margin,» Padenko said. It is known that the startup plans to earn money on a subscription model or on a commission from each transaction: at this stage, the monetization model is still being discussed. In 2023, with the help of investments, the startup team plans to add more blockchains (the product currently works on Ethereum, Aurora, and Avalanche) and expand the number of partners.