Crypto Economy
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Arianna Simpson of a16z on Yield Guild Games, the firm’s newest bet on crypto + gaming
As one of four general partners at Andreessen Horowitz who are investing the venture firm’s new $2.2 billion crypto fund, Arianna Simpson is very focused on how to return that capital and much more to the firm’s limited partners.
Toward that end, she has been more focused of late on startups that combine crypto with gaming. Last month, for example, her team co-led an investment in Virtually Human Studio, the startup behind a digital horse racing service Zed Run, wherein users buy, sell and breed virtual horses whose value rises depending on their performance against other virtual horses. (Each is essentially a non-fungible token, or NFT, meaning it is unique.)
Simpson is relatedly intrigued with NFT-based “play-to-earn” models, wherein gamers can earn cryptocurrency that they can then cash out for their local currency if they so choose. Indeed, a16z is announcing today that it just led a $4.6 million investment in the tokens of Yield Guild Games (YGG), a decentralized gaming outfit based in the Philippines that invites players to share in the company’s revenue by playing games like “Axie Infinity,” a blockchain-based game where players breed, battle and trade digital creatures named Axies in order to earn tokens called “Small Love Potion” that they can eventually cash out. YGG lends players the money to buy the Axies and other digital assets to start the game, so they can start earning money. (The obvious hope is that they earn more than they have to pay YGG for the use of its assets.)
We talked yesterday with Simpson — who joined a16z after first backing some of the same startups, including the blockchain infrastructure company Dapper Labs and the global payment platform Celo — to learn more about what’s happening at the intersection of crypto and gaming. She also shared which platforms a16z tracks most closely to identify up-and-coming crypto startups. Our chat, edited for length, follows.
TC: Zed Run is really interesting. How did you first come across this digital horse racing business?
AS: I think it was crypto Twitter, which honestly is where we’re finding a lot of our gaming investments. The community on there is really incredible and often one of the first places where really exciting new projects are surfaced.
Zed really marks the advent of kind of a new type of more involved gameplay in crypto. If you look at [the collectibles game] CryptoKitties, it was one of the first NFT-based games that really caught the attention of people outside of the crypto sphere. Zed is definitely a derivative extension in the sense that you have a digital animal that you’re playing with, but the gameplay is much more complex, and the thing that’s been incredible to watch is just how excited the community is. People are putting together all kinds of very sophisticated guides around how to play the game, to read [race] courses, how to do all kinds of different things in the game, and tens of thousands of people all over the world [are playing].
TC: Maybe these already exist, but are there endless opportunities across verticals here, like, say, a digital car racing equivalent or a UFC-style equivalent, where people are buying and betting on digital fighters and hoping they’ll rise in value?
AS: There’s an incredibly broad range of possibilities in terms of what’s happening and what will happen in the universe of crypto games. I think at the core of this movement is really the idea of giving more of the value and ownership in these game assets back to the players. That’s something that has historically been a problem. You might spend years and years building up your arsenal of skins or in-game assets, and then a game will change the rules, take [some of your winnings] away from you or do any number of things that can leave players feeling very disappointed and kind of ripped off. The idea [with blockchain-based games] is to make them more open and allow players to have actual ownership in the space themselves.
TC: Which leads us to your newest investment, Yield Guild Games, or YGG. Why did this company capture the firm’s attention?
AS: During the pandemic, a lot of people were put out of work and not able to provide for themselves and for their families. This time kind of coincided with the rise of a game called “Axie Infinity,” one of the first games to pioneer a play-to-earn model, which is becoming a very important theme in crypto games.
In order to play “Axie Infinity,” you need to have three Axies, and generally speaking, that means you need
to buy them upfront. Obviously if you’re out of work, you have no money [so buying these digital pets] can become a very challenging proposition. So [YGG founder] Gabby Dizon in the Philippines, who played “Axie Infinity” started lending out his Axies so other people could play the game and earn tokens that could then be converted to local currency. And so basically YGG emerged as sort of the productization of what they were doing here, so YGG either purchases or breeds in-game assets that are yield-earning, then loans them to out “scholars,” who are the recipients of these in-game assets, and YGG then takes a small cut of the in-game revenue that the players generate over time.
TC: Does a “scholar” have to be a sophisticated player?
AS: There are managers who basically manage teams of scholars; they’re the ones who effectively decide who to bring into the guild.
TC: So these Axies can be cashed out for currency, but where, and who is buying them?
AS: They can be bought or sold on exchanges and other players are buying them if they need to breed in “Axie” and needs some [Axies]; others are buying them for investment purposes. Also, they aren’t necessarily selling the NFTs but they may be selling the tokens that they earn as part of the gameplay.
TC: There are now 5,000 of these scholars playing the game. Are they mostly in Southeast Asia?
AS: A majority of the players and scholars are in Southeast Asia, but we’re seeing really strong international growth as well, both for “Axie Infinity” and YGG, in particular. At this point, scaling internationally is definitely a core focus for the YGG team.
TC: You mentioned crypto Twitter. What about Discord and Reddit? Where else are you looking around for new crypto projects that are bubbling up and capturing people’s imagination?
AS: All of the above. Discord in particular is very actively used by the crypto community, and the thing that’s interesting there is it really allows you to get a pulse for how active a community is, how engaged people are, how frequently they’re talking, and what they’re talking about. It gives you a look into the community at large and that’s a very important thing to consider when looking to make an investment or assess the health of a project.
TC: One of the cofounders of YGG is known only as the Owl of Moistness. Why do we see these pseudonyms so often in this world?
AS: One of the things I love the most about crypto is that it’s a little bit weird. The industry doesn’t take itself too seriously. I actually think that’s really important in terms of allowing people enough creativity to build new things rather than copies of existing things.
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Cent, the platform that Jack Dorsey used to sell his first tweet as an NFT, raises $3M
Cent was founded in 2017 as an ad-free creator network that allows users to offer each other crypto rewards for good posts and comments — it’s like gifting awards on Reddit, but with Ethereum. But in late 2020, Cent’s small, San Francisco-based team created Valuables, an NFT market for tweets, and by March, the small blockchain startup was thrown a serendipitous curveball.
“We just wrapped up for the day, and I was about to go eat dinner, and all these people started texting me,” remembers CEO Cameron Hejazi. Then, he realized that Twitter CEO Jack Dorsey had minted Twitter’s first-ever Tweet through Cent’s Valuables application. “I was basically like, mildly shivering for the rest of the night. The whole team, we were like, ‘Okay, battle stations, prepare to get hacked!’ ”
Dorsey ended up selling his NFT for $2.9 million, and he donated the proceeds to Give Directly’s Africa Response fund for COVID-19 relief. But for Cent, it was as if the small company had just been handed a free marketing campaign. Now, about five months later, Cent is announcing a $3 million round of seed funding with investors like Galaxy Interactive, former Disney chairman Jeffrey Katzenberg, will.i.am and Zynga founder Mark Pincus.
On Valuables, anyone on the internet can place an offer on any tweet, which then makes it possible for someone else to make a counter-offer. If the author of the tweet accepts an offer (logging into Valuables requires you to validate your Twitter account), then Cent will mint the tweet on the blockchain and create a 1-of-1 NFT.
The NFT itself contains the text of the tweet, the username of the creator, the time it was minted and the creator’s digital signature. The NFT also includes a link to the tweet, though the linked content lives outside the blockchain.
Image Credits: Cent (opens in a new window)
There’s nothing proprietary about minting tweets as NFTs — another company could do the same thing that Cent is doing. Even Twitter itself has recently dabbled in giving away free NFT art, though it hasn’t tried to sell actual tweets as NFTs like Cent. Still, Hejazi sees Dorsey’s use of Cent like an endorsement — he thinks it would be difficult for Twitter to shut them down, since Dorsey made $2.9 million on the platform himself. After all, Dorsey chose Cent instead of taking a screenshot of his first tweet, minting the .JPG as an NFT and posting it on a larger NFT platform, like OpenSea.
“We’ve spoken with people at Twitter. I’m positive that we have a healthy relationship going,” Hejazi said (Twitter declined to comment on or confirm whether that’s true). “We thought about applying this approach to other social platforms, like Instagram and TikTok, but we hypothesized that this is particularly suited for Twitter, because it’s a conversation platform, and it’s where all of the crypto people are actually living.”
With Cent’s seed funding Hejazi hopes to continue building the platform. The company’s goal is to enable anyone creative to make an income through the use of NFTs — that means developing tools to make it simpler for its users to mint NFTs, but also, building out its existing creator-focused social network. The content people post on Cent is usually creative work, like art and writing, rather than short posts — it’s closer to DeviantArt than it is to Reddit. These are lofty goals for a $3 million seed funding round, but there are aspects of Cent’s Beta platform that make it promising.
“There’s already value in what we post on social media. It’s just being proxied through ad dollars, and it doesn’t have to be the case that there’s so much wealth concentration in a single entity. We can work toward a system that decentralizes that wealth,” said Hejazi. “These networks as they exist have monopolies on distribution — you can’t take your Twitter audience, download it as a .CSV and send them all an email.”
A screenshot of Cent’s social platform.
In addition to independent distribution lists, Hejazi wants to move away from the ad-supported internet. He references Substack as an example of a company where the creator has control of their list, and at the same time, the platform can remain ad-free, since the money that propels it comes from the users who pay to subscribe to newsletters (and also, venture capital helps).
But Cent does something different by allowing users to essentially invest in creators who they think have the potential to take off on their platform.
Users can “seed” a post, which is how you subscribe to a creator participating on the creatives side of Cent’s platform. As the seeder, you pay a set fee of at least one dollar per month. There’s an incentive to support up-and-coming creators on the platform, because seeders get a portion of the creators’ future profit — it’s like making a bet on them that they will continue to make great content in the future. Five percent of profits go toward Cent, but the remaining 95% is split 50/50 between the creator and all of their past seeders. Participating on this platform would allow creators to network and show support for one another, but doesn’t prevent them from more directly monetizing their work on other creator platforms, like Patreon.
In addition to seeding posts, users can also “spot” other people’s posts — Cent’s version of a “like” button. Each “spot” is the equivalent of one cent from the user’s crypto wallet. Cent’s argument is that getting 1,000 likes on a post on other platforms yields nothing but a vague sensation of social clout. But on Cent, if a user gets 1,000 “spots,” that’s $10. Still, a project like this can only work if enough people use the platform.
“When we started Cent, we chose cryptocurrencies because we loved the idea of someone being able to earn money with nothing more than their creativity and a crypto address,” Hejazi said. “Over time, we’ve found it to be limiting as a payment type — very few people actually own it and have it ready to spend. We’re working on ways to make payments to creators using Cent easier, and are exploring both crypto-native and non-crypto options.”
This mindset echoes other NFT startups like Yat, which allows payments via credit card as part of its “progressive decentralization” model. So much of these companies’ success depends on public buy-in toward an eventual decentralized, blockchain-based internet. But until then, companies like Cent will continue to experiment in reimagining how creatives can get paid online.
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Crypto startup Phantom banks funding from Andreessen Horowitz to scale its multichain wallet
While retail investors grew more comfortable buying cryptocurrencies like Bitcoin and Ethereum in 2021, the decentralized application world still has a lot of work to do when it comes to onboarding a mainstream user base.
Phantom is part of a new class of crypto startups looking to build infrastructure that streamlines blockchain-based applications and provides a more user-friendly UX for navigating the crypto world, something that can make the entire space more approachable to a non-developer audience. Users can download the Phantom wallet to their browsers to interact with applications, swap tokens and collect NFTs.
The crypto wallet startup has banked a $9 million Series A round led by Andreessen Horowitz (a16z), with Variant Fund, Jump Capital, DeFi Alliance, Solana Foundation and Garry Tan also participating. The round, which closed earlier this summer, comes as some venture capital firms embrace a crypto future even as volatility continues to envelop the broader market. Last month, a16z announced a whopping 2.2 billion crypto fund, the firm’s largest vertical-specific investment vehicle ever.
Image via Phantom
The co-founding team of CEO Brandon Millman, CPO Chris Kalani and CTO Francesco Agosti all come aboard from crypto infrastructure startup 0x.
At the moment, Phantom is best-known among the Solana community, where it has become the go-to wallet for applications on that blockchain. The startup’s ambition is to interface with more and more networks, currently building out compatibility with Ethereum and looking to embrace other blockchains, aiming to be a product built for a “multichain world,” Millman tells TechCrunch.
Alongside building out support for other networks, Phantom wants to build more sophisticated DeFi mechanisms right into their wallet, allowing users to stake cryptocurrencies and swap more tokens inside the wallet.
The startup says they have some 40,000 users of their existing wallet product.
Building out a presence on the popular Ethereum blockchain, which already has a handful of popular wallet providers, will be a challenge, but Phantom’s broadest challenge is helping a new breed of crypto-curious users interface with a network of apps that still have a long way to go when it comes to being mainstream-friendly.
“The entire space is kind of stuck in this ‘built by developers for other developers mode,’ ” Millman says. “This bar has been kind of stuck there, and no one is really stepping up to push the bar up higher.”
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Frst and Fabric Ventures announce fellowship program for crypto entrepreneurs
VC funds Frst and Fabric Ventures are teaming up to create Le Crypto Fellowship. With this program, the two firms want to find the next 10 crypto entrepreneurs in France. And they think they might foster the most promising crypto startups if they don’t have any preconceived idea and team yet.
As Pierre Entremont from Frst writes in a Medium post, there are a lot of opportunities if you want to build the next crypto success, but few entrepreneurs are actively looking at this space.
“Nearly all crypto developers and entrepreneurs are already rich and therefore don’t step up their ambition,” he writes.
Blockchain development and DeFi projects are nearly always open source. Learning resources are available for free around the web. So it’s not that hard to get started and build a prototype, but you have to get started. Frst and Fabric Ventures think they can create the right framework to incentivize the next generation of entrepreneurs.
If you get accepted into the program, the two VC firms will hand you €100,000 in exchange for 7% of your company. Basically, this should cover one year of salary for one person in France with a salary of €50,000, €21,000 in employer contributions and €29,000 in expenses. You can be based in another country as long as it’s in the same time zone and you incorporate your company in France.
This way, you get to play around and think about an ambitious idea without feeling any financial pressure. You’ll join a Discord channel with other fellows and you’ll attend weekly Zoom meetings during the first few months. After that, Fabric Ventures and Frst partners will schedule regular office hours with you to check in on your progress.
If you end up creating a proper company and taking your idea to the next level, the fellowship may later ask to invest an additional €700,000 for a 20% stake in the company.
Candidates can apply until June 15. Le Crypto Fellowship isn’t looking for people who already have an idea or are only available part-time. But if you want to join as a team of two or three, you can. Instead of €100,000, you’ll get €200,000 or €300,000. Working as a team will probably help you remain motivated over the long haul.
This isn’t the first startup mentoring program. The Thiel Fellowship is arguably the most well-known. But Le Crypto Fellowship doesn’t limit itself to college dropouts and has a different focus. It’s going to be interesting to see if it pans out and if the VC firms will have a second, a third and a fourth batch down the road.
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Augmented reality NFT platform Anima gets backing from Coinbase
Augmented reality and non-fungible tokens, need I say more? Yes? Oh, well NFTs have certainly had their moment in 2021, but the question of what they do or what can be done with them has certainly been getting voiced more frequently as the speculative gold rush begins to cool off and people start to think more about how digital goods can evolve in the future.
Anima, a small creative crypto startup built by the founders of photo/video app Ultravisual, which Flipboard acquired back in 2014, is looking to use AR to shift how NFT art and collectibles can be viewed and shared. Their latest venture is an effort to help artists bring their digital creations to a bigger digital stage and help find what the future of NFTs looks like in augmented reality.
The startup has put together a small $500K pre-seed round from Coinbase Ventures, Divergence Ventures, Flamingo DAO, Lyle Owerko and Andrew Unger.
“As NFTs move away from being a more speculative market where it’s all about returns on your purchases, I think that’s healthy and it’s good for us specifically because we want to make things that are more approachable,” co-founder Alex Herrity says.
Their broader vision is finding ways for digital objects to interact with the real world, something that’s been a pretty top-of-mind concern for the AR world over the last few years, though augmented reality development has cooled more recently as creators have sunk into a wait-and-see attitude toward new releases from Apple and Facebook. Both the AR and NFT spaces are incredibly early, something Anima’s co-founders were quick to admit, but they think both spaces have matured enough that the gimmicks are out in the open.
“There’s a context shift that happens when you see AR as a vehicle to have a tactile relationship with something that you collected or that you see is a lifestyle accessory versus the common thing now where it’s a little bit more of an experiential gimmick,” co-founder Neil Voss tells TechCrunch.
The team has worked with a couple artists already as they’ve made early experiments in bringing digital art objects into AR and they’re launching a marketplace late next month based on ConsenSys’s Palm platform, where they hope to showcase more of their future partnerships.
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This crypto monitoring startup — ‘We’re bomb-sniffing dogs’ — just raised Series A funding
Solidus Labs, a company that says its surveillance and risk-monitoring software can detect manipulation across cryptocurrency trading platforms, is today announcing $20 million in Series A funding. It’s pretty great timing, given the various signals coming from the U.S. government just last week that it’s intent on improving its crypto monitoring efforts — such as the U.S. Treasury’s call for stricter cryptocurrency compliance with the IRS.
Of course, Solidus didn’t spring into existence last week. Rather, Solidus was founded in 2017 by several former Goldman Sachs employees who worked on the firm’s electronic trading desk for equities. At the time, Bitcoin was only becoming buzzier, but while the engineers anticipated different use cases for the cryptocurrency, they also recognized that a lack of compliance tools would be a barrier to its adoption by bigger financial institutions, so they left to build some.
Fast forward and Solidus today employs 30 people, has raised $23.75 million, and is in the process of doubling its head count to address growing demand. On Friday, we talked with Solidus’s New York-based co-founder and CEO Asaf Meir — one of those former Goldman engineers — about the company’s new round, which was led by Equity Partners, with participation from Hanaco Ventures, Avon Ventures, 645 Ventures, the cryptocurrencies derivative exchange FTX, and a sprinkling of government officials, including former CFTC chair Chris Giancarlo and former SEC commissioner Troy Paredes. We also talked about the kinds of crypto crimes that are on the rise. Excerpts from that chat follow, edited lightly for length.
TC: Who are your customers?
AM: We work with exchanges, broker dealers, OTC desks, liquidity providers and regulators — anyone who is exposed to the risk of buying and selling cryptocurrencies, crypto assets or digital assets, whatever you want to call them.
TC: What are you promising to uncover for them?
AM: What we detect, largely speaking, is volume and price manipulation, and that has to do with wash trading, spoofing, layering, pump and dumps and an additional growing library of crypto-native alerts that truly only exist in our unique market.
We had a 400% increase in inbound demand over 2020 driven largely by two factors, I think. One is regulatory scrutiny. Globally, regulators have gone off to market participants, letting them know that they have to ask for permission, not forgiveness. The second reason — which I like better — is the drastic institutional increase in appetite toward exposure for this asset class. Every institution, the first question they ask any executing platform is: ‘What are your risk mitigation tools? How do you make sure there is market integrity?’
TC: We talked a couple of months ago, and you mentioned having a growing pipeline of customers, like the trading platform Bittrex in Seattle. Is demand coming primarily from the U.S.?
AM: We have demand in Asia and in Europe, as well, so we will be opening offices there, too.
TC: Is your former employer Goldman a customer?
AM: I can’t comment on that, but I would say there isn’t a bank right now that isn’t thinking about how they’re going to get exposure to crypto assets, and in order to do that in a safe, compliant and robust way, they have to employ crypto-specific solutions.
Right now, there’s the new frontier — the clients we’re currently working with, which are these crypto-pure exchanges, broker dealers, liquidity providers and even traditional financial institutions that are coming into crypto and opening a crypto operation or a crypto desk. Then there’s the new new frontier; your NFTs, stablecoins, indexes, lending platforms, decentralized protocols and God knows what [else] all of a sudden reaching out to us, telling us they want to do the right thing, to ensure the users on their platform are well-protected, and that trading activities are audited, and [to enlist us] to prevent any manipulation.
TC: How does your subscription service work and who is building the tech?
AM: We consume private data from our clients — all their training data — and we then put it in our detection models, which we ultimately surface through insights and alerts on our dashboard, which they have access to.
As for who is building it, we have a lot of fintech engineers who are coming from Goldman and Morgan Stanley and Citi and bringing that traditional knowledge of large trading systems at scale; we also have incredible data scientists out of Israel whose expertise is in anomaly detection, which they are applying to financial crime, working with us.
TC: What do these crimes look like?
AM: When we started out, there was much more wholesale manipulation happening whether through wash trading or pump and dumps — things that are more easy to perform. What we’re seeing today are extremely sophisticated manipulation schemes where bad actors are able to exploit different executing platforms. We’re quite literally surfacing new alerts that if you were to use a legacy, rule-based system you wouldn’t be able to [surface] because you’re not really sure what you’re looking for. We oftentimes have an alert that we haven’t named yet; we just know that this type of behavior is considered manipulative in nature and that our client should be looking into it.
TC: Can you elaborate a bit more about these new anomalies?
AM: I’m conflicted about how much can we share of our clients’ private data. But one thing we’re seeing is [a surge in] account extraction attacks, which is when through different ways, bad actors are able to gain access to an account’s funds and are able in a sophisticated way to trade out of the exchange or broker dealer or custodian. That’s happening in different social engineering-related ways, but we’re able, through account deviation and account profiling, to alert the exchange or broker dealer or financial institution we’re working with to avoid that.
We’re about detection and prevention, not about tracing [what went wrong and where] after the fact. And we can do that regardless of knowing even personal identifiable information about that account. It’s not about the name or the IP address; it’s all about the attributes of trading. In fact, if we have an exchange in Hong Kong that’s experiencing a pump and dump on a certain coin pair, we can preemptively warn the rest of our client base so they can take steps to prepare and protect themselves.
TC: On the prevention front, could you also stop that activity on the Hong Kong exchange? Are you empowered by your clients to step in if you detect something anomalous?
AM: We’re bomb-sniffing dogs, so we’re not coming to disable the bot. We know how to take the data and point out manipulation, but it’s then up to the financial institution to handle the case.
Pictured above: Seated left to right is CTO Praveen Kumar and CEO Asaf Meir. Standing is COO Chen Arad.
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Decentralized Komorebi Collective launches to back female and nonbinary crypto founders
As decentralized currencies have taken off in recent months, there’s been renewed attention around DAOs, or Decentralized Autonomous Organizations, as a means of bringing together groups of investors who can deploy capital as a unit while voting collectively on those investments. In the spirit of blockchain, they aim to bring greater transparency to investment decision-making.
A number of high-profile DAOs have launched in recent months as the fervor for crypto mania increased. Komorebi Collective, launching today, is a new organization founded by women in the blockchain space that will be making investments exclusively in “exceptional female and nonbinary crypto founders,” founding member Manasi Vora tells TechCrunch.
The group is comprised of a number of core team members largely assembled from the crypto nonprofit she256 and the organization Women in Blockchain, including Vora, Eva Wu, Kristie Huang, Medha Kothari and Kinjal Shah, who will collectively do most of the heavy lifting behind finding and presenting investments to the group. Other hand-selected members who committed a minimum of $5,000 USD will likely have a lighter commitment.
Each investment will be voted on by all the collective’s key signers, some 36 in total, the majority of whom are female.
“DAOs level the hierarchy of a venture fund by ensuring everyone is going to have a seat at the table,” says Shah, who is also an investor at crypto VC firm Blockchain Capital. “We are very careful in approaching the backers that are really mission-aligned.”
Other members of the DAO include firms like Kleiner Perkins, Mechanism Capital, Dragonfly Capital, IDEO CoLab Ventures and Stacks Accelerator alongside a number of individuals and founders who work at firms like Twitter, Coinbase, Skynet Labs, Celo Labs and Gitcoin.
The organization itself is built on the Syndicate Protocol, a project that shares some of Komorebi Collective’s backers.
The group hopes the structure of their organization will be able to take a mission-driven approach that improves diversity in the crypto space while proving the sustainability of the DAO model. Despite an explosion in startup investments in the past year, women-led startups received just 2.3% of venture dollars invested in 2020, a study in HBR found.
“There’s so much more room to grow when it comes to female founders getting funding and I want to be part of the solution,” Shah tells TechCrunch.
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ZenGo raises $20 million for its secure crypto wallet app
ZenGo, a mobile app to manage your cryptocurrencies, has raised a $20 million Series A funding round led by Insight Partners. ZenGo is a non-custodial wallet, which means that the company doesn’t manage your crypto assets for you — you remain in control.
Other investors include Distributed Global and Austin Rief Ventures. Existing investors Benson Oak, Samsung Next, Elron, Collider Ventures, FJ Labs and others also participated in today’s funding round.
What makes ZenGo different from other wallet apps is that the company is trying to build something that is more secure than your average crypto wallet while remaining simple to use and understand. It competes with other non-custodial wallets, such as Coinbase Wallet (not Coinbase.com), Argent, etc.
In particular, ZenGo is based on multiparty computation (MPC). When you first create your wallet, ZenGo generates multiple secrets that are stored and encrypted in different ways. It means that the company can’t access your tokens directly and you can recover your wallet if you lose your phone.
Other crypto companies focused on infrastructure and enterprise clients have also opted for MPC as their security model. Fireblocks, a company that has recently raised $133 million, is one example.
But ZenGo is building a consumer app. In 2020, the company has processed more than $100 million in crypto transactions from 100,000 users. ZenGo has reached the same milestone in the first three months of 2021 and added another 100,000 users.
You can browse DeFi projects through ZenGo and access savings pools. The startup takes a cut on these investments.
With today’s funding round, ZenGo plans to expand with the same philosophy in mind. You can expect support for more chains and assets, more partnerships and options to buy cryptocurrencies and convert them to fiat money, etc.
The company recently announced plans to launch a debit card. This way, users will be able to convert their crypto assets and then spend them wherever Visa cards are accepted. In other words, ZenGo is building a crypto super app with a focus on security.
Image Credits: ZenGo
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Coinbase to direct list on April 14th, provide financial update on April 6th
Today Coinbase, an American cryptocurrency trading platform and software company, said that it will begin to trade via a direct listing on April 14th. In a separate release the company also said that it will provide a financial update on April 6th, after the close of trading.
Coinbase’s impending public debut comes at an interesting market moment. As some tech companies delay their offerings over demand concerns, Coinbase is pushing ahead with its flotation perhaps in part because it will not price its debut in the traditional sense; direct listings forgo raising capital at a specific price point, and instead merely begin to trade, albeit with a reference price attached.
That Coinbase will release new numbers before beginning to trade is at once interesting and pedestrian. It’s interesting as TechCrunch cannot recall a private company looking to go public holding a similar event. And, Coinbase deciding to share “first quarter 2021 estimated results” and “provide a financial outlook for 2021” is also in part a common move, as many companies provide updated financials in their S-1 documents if time passes from when they first file to when they actually trade.
We’ll be tuned into that call, as the numbers shared will impact not only how Coinbase trades when it does float, but will also provide insight into how active consumer trading is writ large, and particularly in the cryptocurrency space; more than one startup in the market today depends on trading incomes to generate top-line, so seeing new numbers from Coinbase will be welcome.
The company will trade under the ticker symbol “COIN.”
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Spinning out from the cryptocurrency hardware developer Bitfury, LiquidStack pitches a data center cooling tech
Data centers and bitcoin mining operations are becoming huge energy hogs, and the explosive growth of both risks undoing a lot of the progress that’s been made to reduce global greenhouse gas emissions. It’s one of the major criticisms of cryptocurrency operations and something that many in the industry are trying to address.
Enter LiquidStack, a company that’s spinning out from the cryptocurrency hardware technology developer Bitfury Group with a $10 million investment.
The company, which was formerly known as Allied Control Limited, restructured as a commercial operating company headquartered in the Netherlands with commercial operations in the U.S. and research and development in Hong Kong, according to a statement.
It was first acquired by Bitfury in 2015 after building a two-phase immersion cooling 500kW data center in Hong Kong, that purportedly cut energy consumption by 95% versus traditional air cooling technologies. Later, the companies jointly deployed 160 megawatts of two-phase immersion-cooled data centers.
“Bitfury has been innovating across multiple industries and sees major growth opportunities with LiquidStack’s game-changing cooling solutions for compute-intensive applications and infrastructure,” said Valery Vavilov, CEO of Bitfury. “I believe LiquidStack’s leadership team, together with our customers and strategic support from Wiwynn, will rapidly accelerate the global adoption and deployment of two-phase immersion cooling.”
The $10 million in funding came from the Taiwanese conglomerate Wiwynn, a data center and infrastructure developer with revenues of $6.3 billion last year.
“Wiwynn continues to invest in advanced cooling solutions to address the challenges of fast-growing power consumption and density for cloud computing, AI, and HPC,” said Emily Hong, chief executive of Wiwynn, in a statement.
In a statement, LiquidStack said its technology could enable at least 21 times more heat rejection per IT rack compared to air cooling — all without the need for water. The company said its cooling method results in a 41% reduction in energy used for cooling and a 60% reduction in data center space.
“Bitfury has always been focused on leading by example and is a technology driven company from the top of the organization, to its grass roots,” said Joe Capes, co-founder and chief executive of LiquidStack, in a statement. “Launching LiquidStack with new funding enables us to focus on our strengths and capabilities, accelerating the development of liquid cooling technology, products and services to help solve real thermal and sustainability challenges driven by the adoption of cloud services, AI, edge and high-performance computing.”
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