Agora, co-founded by Nick Van Eck, has raised US$12 million in seed funding to launch a new stablecoin, AUSD.

The funding round, led by Dragonfly, drew support from institutional investors, including General Catalyst and Robot Ventures.

Agora’s stablecoin, which will be managed by asset management firm VanEck, is backed by a mix of cash, U.S. Treasury bills, and overnight repurchase agreements.

Nick Van Eck, who is the son of VanEck Chief Executive Officer Jan Van Eck, told Bloomberg that he sees potential for AUSD to benefit regions like Argentina and Southeast Asia.

Agora enters the stablecoin competition against existing giants like Tether and Circle.

Tether is the world’s largest stablecoin with US$105 billion in market capitalization.

Circle’s USDC is far behind with US$33 billion.