Venture Trotter Weekly Review: Week Ending 8/5/2022

Is this the start of a major wave or institutional money coming into crypto? The largest asset manager in the world is opening the floodgates for their institutional clients to invest in BTC, but it remains to be seen what other crypto assets will be open for trading in the future. Also, the French VC that invested in homeruns like Airbnb, Neflix, and Slack is launching a €100M – €110M web fund. For startup DAOs that would rather not rely on institutional investors for working capital, a web3 marketplace will enable them to borrow from token holders of an open-source debt platform.

  1. Blackrock is working with Coinbase to offer institutional clients access to crypto
  2. Aglaé Ventures, the French VC that invested in Airbnb, Neflix, and Slack is launching a web3 fund
  3. Debt DAO, a decentralized marketplace to lend to DAOs and protocols, raised $3.5M in a seed round led by Dragonfly Capital
  4. Stride, a startup that’s offering a method for liquid staking your ATOM tokens, raised $6.7M in a seed round co-led by North Island VC
  5. Coherent, the startup that wants to become the Plaid of crypto, raised $4.5M in a seed round from Kindred Ventures
  6. Galoy, the developer of an open-source platform that enables organizations to easily integrate BTC payments, raised $4M in a round led by Hivemind Ventures

1. The largest asset manager in the world, Blackrock, is working with Coinbase to offer institutional clients access to crypto via Coinbase Prime. Initially, only BTC will be available for trading through this partnership.

Blackrock manages $9T in customer funds, so it’s impossible to ignore any move they make towards crypto or anything else. Joseph Chalom, Global Head of Strategic Ecosystem Partnerships at BlackRock said, “Our institutional clients are increasingly interested in gaining exposure to digital asset markets and are focused on how to efficiently manage the operational lifecycle of these assets.” Given the fact that Blackrock manages $9T in customer funds

2. The VC that invested in Airbnb, Neflix, and Slack is launching a web3 fund. Paris-based Aglaé Ventures is planning to raise between €100M and €110M, but the exact timing of the launch is uncertain.

It’s becoming increasingly likely that you will invest in projects with European VCs on the cap table. Per a recent report by The Block, In Q2 of this year Europe surpassed Asia to hold the 2nd largest global share of blockchain venture funding.

3. A decentralized debt marketplace is on the way to support growth stage DAOs and protocols. Debt DAO raised $3.5M in a seed round led by Dragonfly Capital, with participation from GSR, Numeus, and Fasanara Capital.

Financing is obtained through Debt DAO’s smart contract called “Spigot,” which secure cash flows from the borrower to automatically repay lenders. Lenders can either choose to negotiate deals themselves via P2P loans, or they can deposit into pools where credit experts manage investments. The value add for DAOs is that with this debt financing they can raise working capital without selling off their native tokens and diluting ownership.

Investment Opportunity: In order to participate in this marketplace, you will need to hold the DEBT utility token. In a future use case, tokens can be staked to debt contracts, and staked users will earn a percentage of interest for the corresponding loan.

4. A new startup is offering liquid staking for Cosmos’ native ATOM token, and plans to support more Cosmos assets in the future. Stride raised $6.7M in a seed round co-led by North Island VC, Distributed Global and Pantera Capital.

Traditionally, ATOM token holders who were looking for yield could choose between staking their tokens in Cosmos and earning passive income while locking up their tokens, or participating in a comparatively riskier DeFi that offers higher yield. Now if you stake your ATOM on Stride, you can trade or invest your liquid staked ATOM tokens.

Investment Opportunity: As of this writing, the mainnet launch is not quite ready yet, but it should be possible to stake your ATOM on Stride very soon.

5. A newly funded startup hopes to become the Plaid (a data transfer network connecting bank accounts to payment apps) of crypto. Coherent raised $4.5M in a seed round from Kindred Ventures, Coinbase Ventures and others. Coherent was founded by a former Coinbase software engineer.

Coherent is building infrastructure that will enable your user profile and data to be portable across any web3 application that supports “Login With Ethereum.” This means that your wallet data would auto-populate, and authentications for Ethereum logins are simplified. Coherent’s product is expected to launch in September.

6. An open-source banking platform seeks to accelerate BTC adoption. Galoy raised $4M in a round led by Hivemind Ventures and participation from Valor, Kingsway Capital and AlphaPoint. Previously in 2020 Galroy launched the Bitcoin Beach Wallet (an open sourced BTC based community banking solution) in El Salvador shortly before BTC became legal tender in that country.

Galoy’s platform, GaloyMony, enables organizations to utilize the Lightening network in order to integrate BTC payments and run a BTC bank. Additionally, Galoy is launching a platform called Stablesats which through the use of derivatives (so there are risks involved), allows users to hold dollar equivalents in their Lightening wallets. The derivative contracts creating Stablesats are fully collateralized with BTC.

Stablesats is similar to stablecoins in that they both seek to solve BTC’s volatility problem, but Stablesats does not utilize tokens. Galoy provides a 2-minute demo here.

Disclaimer: The content presented is for informational purposes only and does not constitute financial, investment, tax, legal, or professional advice. The content is provided ‘as is’ without any representations or warranties, express or implied.

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