The news comes as the investment giant announced that it has acquired 250 Digital, a crypto investment management firm spun out of CoinFund. The companies didn’t disclose how much Franklin Templeton acquired 250 Digital for.

“Crypto’s institutional moment has arrived, and Franklin Crypto will help our global clients navigate this complex and rapidly evolving asset class by delivering the expertise, knowledge and digital asset products that meet their sophisticated investment needs,” Christopher Perkins, who will head the new division, said in a statement shared with DL News.

News of the deal comes as traditional financial firms have been on a shopping spree of late. In March, Mastercard acquired stablecoin infrastructure startup BVNK for $1.8 billion, and institutional lender FundBank bought Irish blockchain startup Trrue Chain for $11 million. Similarly, Stripe, the $159 billion fintech, has bought businesses like stablecoin venture Bridge.

Experts expect traditional financial firms buying blockchain businesses will drive the value of crypto mergers and acquisition deals to crest the $37 billion value achieved in 2025.

Franklin Crypto

Franklin Crypto will expand Franklin Templeton’s existing suite of crypto and blockchain VC investment offerings, the firm said.

It also aims to broaden the firm’s digital assets investment management platform. Franklin Templeton Digital Assets manages approximately $1.8 billion in global assets as of December 31.

The deal is expected to close in the second quarter of the year.

Franklin Templeton has made no secret about its crypto ambitions.

In December, Robert Crossley, global head of industry advisory services at Franklin Templeton, told DL News that the investment firm saw growing interest from institutional investors.

“We are seeing growing interest from more established investors who are thinking about diversification and long-term outcomes,” Crossley said. “Younger investors are drawn to crypto because it matches how they already interact with technology and money.”

“The gap between these groups is narrowing as digital assets become part of mainstream financial planning,” Crossley said.

Eric Johansson is DL News’ managing editor. Got a tip? Email him at eric@dlnews.com.

“It is definitely harder to raise than it was last cycle,” Start told DL News.

“Funds are making fewer bets, and they’re being much more selective about where they take exposure,” he said.

Amid the $2 trillion industry drawdown, capital is increasingly being directed towards companies focused on stablecoin infrastructure, payments and financial connectivity, where demand is seen as more closely linked to real economic activity, he said.

“There’s a lot less appetite for broad narratives and a lot more focus on whether a company has real usage, a credible regulatory setup, and a product that fits into actual financial flows.”

Still, crypto startups raised $197 million this week, DefiLlama data shows.

Here are the top three raises this week.

Startale Labs, $50 million

Startale Labs, the Singapore-based developer behind the Astar Network, has raised $63 million in a Series A round.

SBI Holdings led the raise. The backing of the financial services company underscores how Asian financial institutions and the blockchain sector are growing more aligned.

The company is positioning itself as middleware for enterprises entering crypto. It says the fresh capital injection is earmarked to advance its Astar zkEVM and Swanky Suite products.

For SBI, the investment reflects a longer-term wager on multi-chain infrastructure operating within a regulated global framework.

Ledger, $50 million

France-based hardware wallet maker Ledger has secured a $50 million funding extension. The raise reinforces its position as a leading provider of self-custody solutions.

The raise via secondary share sale highlights continued demand for secure asset storage as institutional participation grows.

Proceeds are expected to support expansion of Ledger Enterprise and further rollout of its Stax device.

Despite competition from software-based MPC wallets, Ledger’s funding momentum suggests hardware custody remains the preferred model for high-value and institutional assets.

The raise comes as Ledger co-founder Éric Larchevêque is advocating for crypto workers’ right to wear guns in France. His co-founder, David Balland, was the victim of a brutal kidnapping in 2025.

Tazapay, $36 million

Singapore-based Tazapay has raised $36 million in a Series B round.

Stablecoin issuer Circle’s venture capital arm led the raise. Circle’s backing points to a strategic push to expand the use of USDC as a settlement asset in emerging markets.

Tazapay’s platform offers fiat-to-crypto rails across more than 70 markets, enabling local collection and payouts supported by integrated stablecoin liquidity.

By bypassing legacy systems such as SWIFT, Tazapay is targeting inefficiencies in global B2B payments.

You’re reading the latest instalment of The Weekly Raise, our column covering fundraising deals across the crypto and DeFi spaces, powered by DefiLlama.

Lance Datskoluo is DL News’ Europe-based markets correspondent. Got a tip? Email him at lance@dlnews.com.

The deal marks the first time a UK-regulated bank will tokenise deposits on a public blockchain while keeping them FSCS-protected and interest-bearing.

Yet it also throws into question the role of Cardano, Input Output Global’s first blockchain, launched in 2017.

Despite Midnight being the focus of attention, Cardano won’t get left behind, Charles Hoskinson, the firm’s founder, said on X.

“When we do deals like this almost always there’s a Cardano component to the infrastructure. It’s not exclusive to Midnight,” Hoskinson said.

Monument is a so-called digital challenger bank. It targets financial services professionals and entrepreneurs, and requires a minimum deposit of £25,000 to open an account.

The deal comes as crypto projects look for commercial tie-ups with traditional financial firms as the two industries converge.

In recent years, Wall Street firms have become fascinated by tokenisation — the idea of representing ownership rights of traditional assets like stocks, bonds or real estate as tokens on a blockchain.

Among tokenisation’s biggest proponents is Larry Fink, the CEO of $14 trillion asset manager BlackRock. In his annual 2026 shareholders’ letter, Fink praised tokenisation for its ability to reduce fees and open up investing to more people.

‘Tip of the spear’

Midnight is a privacy-focused partner chain to Cardano. It enables Cardano DeFi protocols to use zero-knowledge technology to keep transactions private, and also relies on Cardano for its security.

Hoskinson said both blockchains will benefit financially from each others’ successes.

“Midnight is leading the way, it’s the vanguard, the tip of the spear,” he said. “It’s showing how to do commercialisation. It’s showing how to get real-world assets into the cryptocurrency space.”

Cardano was conceived as a so-called third-generation blockchain, and attempted to solve the scalability, interoperability, and sustainability issues facing Bitcoin and Ethereum. Its developers placed a strong emphasis on scientific rigour, requiring it to be academically peer-reviewed.

Yet technological setbacks over the years have seen it lose ground to rivals.

DeFi protocols on Cardano hold just $146 million in deposits, an amount that pales in comparison to Ethereum’s $76 billion and Solana’s $8.7 billion.

Cardano’s ADA token is down over 91% from its September 2021 all-time high.

If Midnight continues to find commercial success, it could give Cardano a much-needed boost.

‘Flagship deal’

Midnight’s deal with Monument goes further than just letting customers tokenise their deposits.

The second phase of the deal will focus on providing tokenised products on the Midnight blockchain, such as real-world asset investments, to Monument’s customers.

Further in the future, Midnight and Monument plan to introduce blockchain-based lending, allowing customers to borrow against their investments

This, the Midnight Foundation said, is designed to provide Monument customers with more cost-effective access to credit than traditional borrowing, allowing them to access liquidity without selling their investments.

“This is a flagship deal, and we take it very seriously,” Hoskinson said. “It’s something we’re real proud of.”

Midnight’s NIGHT token, the native utility and governance token for the network, is up 3.1% over the past 24 hours.

Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.

The escalating war in the Middle East will force investors to rethink “asset security, liquidity, and stability in an increasingly multipolar world,” Tim Sun, senior researcher at Hong-Kong asset manager Hashkey Group, told DL News.

But some sectors — primarily stablecoins — will win from the chaos, he stressed.

“Instability actually strengthens the core thesis for stablecoins,” Sun said. “When traditional banking channels face sanction risks or capital controls, stablecoins become the default settlement layer.”

“Demand only grows in a risk-off environment. Infrastructure that enables faster, cheaper stablecoin settlement—whether on/off-ramps, compliance tools, or cross-chain bridges—will continue to attract capital,” he said.

Still, crypto startups raised an impressive $192 million this week, DefiLlama data shows. That brings this year’s total fundraising up to $2.75 billion so far.

Here are the top three funding rounds this week.

Kast, $80 million

London-based stablecoin-focused fintech Kast raised $80 million in a Series A round at a $600 million valuation.

The round was led by QED Investors and Left Lane Capital, backing the company’s push to link digital dollars more closely with everyday retail payments.

Kast’s platform integrates major stablecoins such as USDT and USDC with widely used mobile wallets including Apple Pay, allowing users to spend crypto balances through familiar consumer channels.

Cryptio, $45 million

Crypto accounting platform Cryptio secured $45 million in a Series B funding round this week.Sentinel Global and Blackfin Capital Partners led the raise.

The company provides software designed to deliver audit-ready accounting data for enterprises handling crypto transactions, an increasingly important requirement as regulators tighten oversight of the sector.

The new capital is expected to support expansion among large financial institutions grappling with reporting, tax and compliance obligations tied to digital asset activity. The deal reflects a broader shift in investor priorities, with funding increasingly directed towards back-office infrastructure that enables transparency and regulatory compliance rather than the experimental protocols that dominated earlier crypto cycles.

Zcash Open Development Lab, $25 million

The Zcash Open Development Lab has raised $25 million to strengthen the core infrastructure of the privacy-focused cryptocurrency network and expand the usability of its ecosystem.

The funding will support development of the Zodl wallet and related interoperability tools designed to make Zcash easier to use across different blockchain networks.

Despite increasing regulatory pressure on privacy-focused technologies, the investment suggests that some backers still regard privacy-preserving tools as a fundamental component of digital financial infrastructure.

The focus of the funding also points to a shift in priorities within the ecosystem, from purely technical protocol work towards broader usability and cross-chain integration.

You’re reading the latest instalment of The Weekly Raise, our column covering fundraising deals across the crypto and DeFi spaces, powered by DefiLlama.

Lance Datskoluo is DL News’ Europe-based markets correspondent. Got a tip? Email him at lance@dlnews.com.

Ripple just achieved a $50 billion valuation as part of a massive share buyback programme, which pushed its valuation up by 25% since it raised $500 million in November, according to Bloomberg.

At the same time, the price of XRP, the cryptocurrency developed by the firm, has lost over 60% of its value since reaching an all-time high in July, but that hasn’t dissuaded the token’s supporters from investing billions into exchange-traded funds tied to the asset.

First, the valuation. Ripple has kicked off a share buyback programme for some $750 million worth of shares from investors and employees. The buyback drive will continue through April, Bloomberg reported.

Ripple most recently bought back $285 million worth of shares from early investors and employees at an $11 billion valuation in January 2024, according to Reuters.

The new buyback drive comes hot on the heels of Ripple securing a $500 million strategic investment from affiliates of Fortress Investment Group, Citadel Securities, Pantera Capital, Galaxy Digital, Brevan Howard, and Marshall Wace.

XRP down 60%

The latest buyback drive comes as uncertainty weighs on the crypto market.

The market has lost almost half its value since October, and a perfect storm of geopolitical turmoil, tariffs, and the escalating conflict in the Middle East threatens to drag down cryptocurrency prices further.

XRP has not been left unscorched. The Ripple-linked asset has lost 54% of its value since October.

Yet, that doesn’t seem to deter the XRP Army, the collective noun for the asset’s diehard fans. No

In fact, they’ve injected over $1.5 billion into XRP ETFs despite the market drawdown.

“My guess is this [degree of inflows] is largely XRP superfans versus casual retail,” Bloomberg Intelligence ETF analyst Eric Balchunas wrote on X on March 10.

Ripple didn’t immediately return a request for comment.

Eric Johansson is DL News’ managing editor. Got a tip? Email him at eric@dlnews.com.

Charles Chong, vice-president of strategy at crypto advisory firm BlockSpaceForce, told DL News that investors have “real alternatives with faster revenue visibility.”

“Crypto teams need to work harder,” he said. “That’s pushing founders to be more precise about defensibility, monetisation, and how their models hold up in a slower market.”

Chong’s words of caution come as crypto startups raised $128 million in the first week of March, DefiLlama data shows. That brings the total amount raised in 2026 to nearly $2.5 billion so far.

Still, this week’s investors include the likes of Peter Thiel’s Founders Fund, Ripple, Y Combinator, Wintermute, and Sequoia Capital, all piling into infrastructure for payments, trading, decentralised finance.

“Investors are still writing cheques, but only for teams that can clearly explain value capture and opportunity cost, especially in a world where AI offers a very different risk-reward profile,” Chong said.

Here are the top three raises this week.

ARQ, $70 million

ARQ, the Latin American fintech previously known as DolarApp, secured $70 million in Series B round, the largest venture round in the sector this week.

The raise was led by Sequoia Capital and Founders Fund. It seemingly signals institutional confidence as the company shifts from a cross-border dollar transfer service into a broader digital banking platform.

Handling more than $10 billion in annualised transaction volume across roughly two million users, ARQ plans to deploy the capital toward a full brand overhaul and the rollout of new products including wealth management services and high-yield local currency accounts.

The move highlights rising demand across Latin America for stablecoin-linked financial infrastructure, as consumers and businesses seek protection from persistent currency volatility and limited access to traditional banking services.

Crossover Markets, $31 million

Crossover Markets raised $31 million in Series B funding roundTradeweb Markets led the raise that valued the firm at roughly $200 million. Additional investors included Ripple and crypto market-maker Wintermute.

The company operates CROSSx, an execution-only electronic communication network built for institutional digital asset trading

Unlike many crypto exchanges, the startup says it separates trade execution from custody and market-making functions, a structure designed to minimise conflicts of interest and appeal to traditional financial firms.

QFEX, $9.5 million

QFEX, a hybrid derivatives exchange focused on tokenised real-world assets, raised $9.5 million in seed funding led by Yuri Sagalov of General Catalyst, with backing from Y Combinator and investor Paul Graham.

Founded by Cambridge mathematics graduates and former high-frequency traders from Citadel and Tower Research Capital, the platform allows investors to trade equities, commodities and foreign currencies via perpetual derivatives that operate around the clock.

You’re reading the latest instalment of The Weekly Raise, our column covering fundraising deals across the crypto and DeFi spaces, powered by DefiLlama.

Lance Datskoluo is DL News’ Europe-based markets correspondent. Got a tip? Email him at lance@dlnews.com.

The only question now is where exactly will the next big businesses crop up?

From artificial intelligence to geopolitics — that question is hard to answer.

DL News asked five investors about what they’re keeping an eye out for in 2026.

Hoolie Tejwani, Head of Coinbase Ventures

Perpetuals are already the most used financial product in crypto. They’ve been around for years, handle vast amounts of trading, and work even when markets get chaotic.

What’s new is how they’re being used. Instead of just speculating on crypto prices, people are using perps to create synthetic markets tied to real-world assets. That could be inflation data, oil prices, private companies, or other signals people care about but can’t easily trade today.

The key point is you don’t need to actually own the thing you’re trading. You don’t have to move oil barrels or custody shares. That makes it much faster to launch new markets and lets them scale globally from day one.

‘Taken together, 2026 feels less like hype and more like maturity.'

Hoolie Tejwani, Head, Coinbase Ventures

A few other shifts are happening alongside this. Crypto’s superpower is enabling 24/7 global markets for anything. Anything that can be tokenised and traded will be, and the lines between trading platforms will blur.

Decentralised finance products are also starting to work together better, with a more intuitive user experience, so we expect new cohorts of users and capital to onboard to DeFi. And as AI systems become more capable, crypto is quietly becoming the way those systems move money and coordinate actions.

Regulation also plays a role. This year was when legislation like the Genius Act helped move crypto out of a legal grey zone. Market clarity is the next big unlock, which we expect to see in 2026.

When clear rules are set, capital gets more patient, and builders can play beyond the next quarter.

Taken together, 2026 feels less like hype and more like maturity.

Founders are thinking long-term, building real infrastructure, and focusing on what actually gets used. That’s usually when things start to stick, and we’re investing in the teams that show up to build with five- to 10-year visions.

Mike Giampapa, General Partner, Galaxy Ventures

Despite lacklustre price performance in 2025, with total crypto market capitalisation down roughly 13% year-to-date, we’ve seen unprecedented improvements in underlying fundamentals.

We expect adoption of stablecoins and other tokenised assets to continue accelerating in 2026 and to represent a secular growth trend over the next one to two decades.

The US government is likely to continue supporting the global export of dollar-backed stablecoins, underpinning a new wave of fintechs and neobanks that deliver better, faster, cheaper financial services.

In parallel, incumbents are beginning to fight back by launching blockchain-enabled products across digital asset custody, cross-border payments, stablecoin issuance, cards, and treasury management, making 2026 a true inflexion point for institutional adoption.

Large banks, asset managers, and broker-dealers increasingly view these efforts as opportunities for growth and margin expansion, replacing legacy rails with modern blockchain infrastructure without requiring end users to materially change existing behaviour.

As more assets move onchain, institutional capital formation should accelerate, creating a supportive backdrop for DeFi, with crypto primitives such as prediction markets, perpetuals, and vaults continuing to gain relevance.

Following a landmark year for crypto mergers and acquisitions in 2025, we expect continued consolidation as incumbents execute on strategic roadmaps.

Venture funding activity is ultimately downstream of new fund formation, which is likely to remain challenging as many institutional allocators remain over-allocated to venture and private equity more broadly.

Finally, after what was the most important year in history for crypto regulation, with the signing of the Genius Act into law in July, attention now turns to advancing a market structure bill in 2026, which will further reinforce institutional adoption."

Francesca Conti, Head of Acceleration and Incubation, CV Labs

Next year is poised to be the year of further institutional adoption in the blockchain arena.

With players like Binance awarded three Abu Dhabi Global Market licenses in the United Arab Emirates, we are confident that the new regulatory clarity emerging across other jurisdictions is a positive indication of what is to come in the new year.

In our experience, good regulation enables innovation and, in turn, allows institutions to participate in the global rise of digital asset markets and correlated industries.

Similarly, crypto exchange Bullish raising $1 billion for its public offering signalled a green light for digital asset companies on Wall Street, which can only stimulate stronger institutional interest that meets their clients’ demand.

We anticipate that growth will continue in other jurisdictions at an even more rapid pace, particularly in regions where the impact of blockchain and frontier technology extends beyond financial market expansions to deeply enable critical industries such as agriculture and health to operate with significant efficiencies.

On the heels of our recently closed African Blockchain fund, backed by well-known leaders such as Circle Ventures, the investment arm of the US-based issuer of the USDC stablecoin, the appetite in emerging markets is more evident than ever.

Our internal research shows that investment in Africa’s blockchain ecosystem is on the rise — with blockchain accounting for over 7% of total venture capital funding and 12.7% of all deals on the continent.

Whilst payments, infrastructure and fintech rails continue to dominate verticals for us at CV VC, we remain deeply committed to the emergence of blockchain technology as the bedrock rail on which better, transparent and verifiable actions can be managed across web3.

Jeff Ren, Founder, OKX Ventures

In 2026, the smarter money in crypto will follow the places where the technology is interoperable with the rest of finance. There’ll still be plenty of chatter about a possible Bitcoin Act or new waves of spot exchange-traded funds, but the more durable story lies in the plumbing underneath.

In 2026, we’ll see more projects explore product-market fit around risks people already care about. That means more niche assets coming onchain: stocks, gold, intellectual property, even trading cards and GPUs, with global, 24/7 access and the ability to plug straight into DeFi.

The goal isn’t to invent new things to speculate on, but to package familiar risks — rates, oil prices, elections, credit spreads — in intuitive formats that the everyday user can actually navigate to get exposure or hedge.

Stablecoins already move more value than big card networks, and with rulebooks like the Genius Act in the US and sweeping crypto regulations in Europe, called Markets in Crypto-Assets Regulation, banks and brokerages are finally comfortable launching their own stablecoins and tokenised products.

That’s how stablecoins move from trading chips into the default rail for salaries, business-to-business payments and cross‑border trade in a more technology‑driven, compliance‑first environment.

Perpetuals still dominate crypto, but they come with funding fees and a learning curve that favours professional traders. Options can offer cleaner upside or protection without that ongoing drag, especially in simpler, more user‑friendly formats.

Expect to see more click‑once structures, including binary yes-no contracts on events that look and feel closer to prediction markets than traditional options.

Underpinning it all, more of the flow will be machines talking to machines: bots and agents holding balances, paying for services and rebalancing on autopilot. From a VC angle, that means fewer spray‑and‑pray bets on narratives, and more focus on whether a product can work with regulators, institutions, and this emerging machine economy at the same time.

Petr Martynov, Head of Growth, Morningstar Ventures

For most of crypto’s history, investors chased infrastructure. That meant faster blockchains, more decentralisation, and cheaper fees.

That phase is largely done.

By 2026, the most interesting investment opportunities will come from what gets built on top of that foundation.

First, I expect a real wave of consumer crypto apps — especially in DeFi — that don’t feel like crypto at all. The tech is finally invisible. Users won’t think about wallets, seed phrases, or gas fees.

They’ll just use products that feel as smooth as Revolut or Robinhood, but happen to run on blockchains underneath. That’s when adoption stops being theoretical.

Second, the line between traditional finance and DeFi will blur fast.

As regulation becomes clearer, particularly in the US, we’ll see more familiar financial products move on-chain: equities, payments, settlement rails.

This isn’t crypto replacing traditional finance. It’s TradFi quietly using blockchain because it’s cheaper, faster, and global by default.

Finally, I’m watching how blockchains become verification layers for AI and robotics.

As machines generate more data and make more decisions, we’ll need neutral systems to prove what happened, when, and by whom.

Eric Johansson is DL News’ managing editor. Got a tip? Email at eric@dlnews.com.

Hash price — the metric measuring how much revenue miners earn per unit of computing power — hit an all-time low in recent weeks and the depressed price of the leading cryptocurrency is hurting profit margins for companies in the cutthroat industry.

But pivoting towards selling their processing powers to fuel the artificial intelligence revolution offers an increasingly alluring alternative.

Nick Hansen, CEO and co-founder of the Luxor mining pool, told DL News that “resisting the urge to transition to AI” will be Bitcoin miners’ biggest challenge in 2026.

Despite the move to AI being attractive, he said that it’s still “very difficult to balance [both mining and high-performance computing].”

The prediction comes as Bitcoin miners are struggling to make ends meet due to free-falling crypto prices, plunging daily transaction fees, and plummeting rewards for maintaining the blockchain — and that’s when they’re not being banned from operating all together.

Falling rewards

Bitcoin’s price trading at around $87,000, 30% below its October all-time high, is one reason for miners’ struggles. Most top miners in Q3 were breaking even at about $90,000 per Bitcoin, MinerMag data shows.

The lower the price, the smaller the rewards — in dollar terms — for maintaining the blockchain will be.

Those rewards have already shrunk after last year’s halving event slashed miner rewards for minting blocks in half to 3.125 digital coins.

Lower transaction fees aren’t helping miners make money, either. While institutional adoption by the likes of BlackRock has helped bring crypto into the mainstream, it means that a lot of Bitcoin has been locked up and won’t be used to make transactions.

With fewer transactions, miners face fewer fees.

AI pivot

Hence the AI pivot.

A number of top publicly listed miners have started directing resources to providing the infrastructure for high-powered computing.

Some miners are already going all-in on the industry as minting the biggest digital coin by market cap becomes unprofitable. Nasdaq-listed Bitfarms in November announced that it would wind down mining operations to focus instead on high-performance computing.

“Bitcoin miners are now an integral part of the AI value chain, providing warm powered shells for AI data centres — considered the biggest bottleneck to execution,” Bernstein analysts wrote in a November 3 report.

While many public miners are not dropping mining operations completely, they’re marketing themselves as “compute” or “digital infrastructure” companies while switching between minting digital coins and providing compute for AI — depending on which is more profitable.

“We’ve seen way more miners trying to say they’re in the ‘compute business’ as opposed to digital asset mining,” Hansen added. “Which I think is fair, given any idea of harnessing compute to produce value is easier to understand for the average investor.”

Top miners Terawulf, IREN, and Cipher Mining have signed multi-year HPC contracts with Alphabet Inc.’s Google and Microsoft.

Bitcoin miners have been eyeing up the AI space for some time now. While both industries require huge amounts of energy and data centers, the move isn’t always easy — AI data centres require more expertise than Bitcoin mining operations.

Gwyn Lauber, VP of corporate affairs at Bitcoin mining tech firm Canaan, said: “Margins are clearly under pressure right now, but Bitcoin mining has experienced many similar moments in the past.”

Lauber added that miners would be paying attention to the macroeconomic picture next year — including the next steps from the Federal Reserve.

“An easing cycle in 2026 would likely result in better Bitcoin prices and mining margins,” she said.

Mathew Di Salvo is a news correspondent with DL News. Got a tip? Email at mdisalvo@dlnews.com.

Tether, which issues USDT, the third biggest digital asset by market capitalization, on Friday said it had submitted a binding all-cash proposal to Juventus owner Exor to buy its entire stake in the club. Tether also offered one billion euros (over $1.1 billion) to invest in the club as part of the proposal.

But on Saturday, Exor CEO John Elkann said in a video statement that the club was not for sale.

“Juventus, our history, our values, are not for sale,” he said.

Exor, which has major investments in companies like Ferrari and Stellantis, then said in a statement that its board of directors has unanimously rejected the unsolicited proposal. Exor is owned by Italy’s influential Agnelli family.

Tether Submits Proposal to Acquire Juventus Football Club 🦓

Read more: https://t.co/CDv8OosqFU

— Tether (@Tether_to) December 12, 2025

“Juventus is a storied and successful club, of which Exor and the Agnelli family are the stable and proud shareholders for over a century, and they remain fully committed to the Club, supporting its new management team in the execution of a clear strategy to deliver strong results both on and off the field,” the statement read.

DL News reached out to Exor for comment.

Tether already holds a more than 10% stake in the club since upping its shareholder position in April as part of the crypto giant’s diverse portfolio.

But Tether CEO Paolo Ardoino said on Friday that the proposal to become majority shareholder was personal.

“This proposal reflects a belief in Juventus as more than a football club,” Tether said in a statement.

“As a boy, I learned what commitment, resilience, and responsibility meant by watching Juventus face success and adversity with dignity,” Ardoino added. “Those lessons stayed with me long after the final whistle.”

“Our goal is to contribute positively to the club’s future, to support sporting performance at the highest level, and to help Juventus continue to grow sustainably in a rapidly evolving global sports and media landscape.”

Tether did not immediately respond to questions from DL News.

The stablecoin giant has branched out from issuing the most-traded digital token.

Just this week, the company debuted a wellness app and announced that it had invested in humanoid robotics firm Generative Bionics as part of a €70 million ($82 million) funding round.

And in March, the El Salvador-based company bought a majority stake in South American agricultural firm Adecoagro.

Mathew Di Salvo is a news correspondent with DL News. Got a tip? Email at mdisalvo@dlnews.com.

The deal will give professional and institutional investors — such as asset managers, private equity and credit firms, custodians and market makers — access to “scalable infrastructure for tokenised assets,” Philipp Pieper, co-founder of Swarm Markets, told DL News.

“This acquisition brings together the two layers institutions have been missing: trusted, machine-readable data for private assets and a regulatory-compliant execution and trading stack,” Pieper said.

Inveniam is an American data analytics firm that specialises in providing clear data about the private-market assets, including real estate and private credit. In October, the company acquired decentralised cloud storage provider Stor for an undisclosed amount.

The Swarm Markets deal highlights the growing competition among crypto companies and fintech firms looking to tokenise private markets.

Crypto exchange Kraken and stock-trading platform Robinhood are just two businesses that have ventured into this space over the past year.

The interest in private markets is understandable. Investment giant BlackRock estimates that the market will grow by over 53% to be worth $20 trillion by 2030.

“The tokenisation of public and private markets is one of the largest infrastructure opportunities in global finance,” Pieper said.

‘Only just beginning’

Despite the growing competition, Pieper is confident that Swarm Markets and Inveniam will make an impact.

“We don’t believe the space is crowded,” he said. “In fact, it is only just beginning. Many companies have announced intentions to enter tokenisation or private markets, but very few have a working product that investors can actually use today.”

Essentially, he argues that, once you parse through the flood of announcements, few companies are doing what the two companies can do.

Pieper noted that Swarm Markets has been live for years, bringing public securities on-chain in a compliant, DeFi-compatible way.

Combine that with Inveniam having brought more than $200 billion of private-market assets to the blockchain, and you’ve got a winning combo, Pieper argues.

Moreover, he argues that private markets are primed for an update.

“Private markets dwarf public markets in terms of market value, but remain largely opaque, slow, and inaccessible,” Pieper said.

“Investors increasingly expect the same transparency, liquidity, and real-time data they experience in public markets. Tokenisation is the path towards that.”

Eric Johansson is DL News’ managing editor. Got a tip? Email at eric@dlnews.com.

The New York Broker and financial services group has established itself as a prominent underwriter of crypto-related stock offerings and has advised several digital asset treasury firms, companies that have bet their future on the idea that crypto prices will continue to soar.

Clear Street has also acted as an underwriter for Trump Media & Technology Group, US President Donald Trump’s family’s media company, the Financial Times reported.

Clear Street didn’t immediately return a request for comment.

Under strain

The news comes as the digital asset treasury fad has come under strain in recent months as crypto prices have crashed.

The business model was pioneered by Michael Saylor’s Strategy — which Clear Street has served as an underwriter for — in 2020 when the software company pivoted to essentially become a Bitcoin proxy by buying the digital asset.

By July this year, the gamble had driven Strategy’s share price to surge some 3,500%, incentivising other firms to plough their capital into digital assets.

The problem? Crypto prices have crashed in recent months. Bitcoin, for instance, is down just under 30% from its $126,000 October high.

Digital asset treasuries’ stocks have fallen in tandem with the price. Strategy is down some 60% since its July high. Nakamoto, another crypto treasury firm, has seen its share price fall some 95%.

Metaplanet, the hotel operator turned Bitcoin treasury, has an average cost that sits at around $108,000 per Bitcoin. With Bitcoin at $89,000, the company is underwater by nearly $17,000 per coin across its 30,823 Bitcoin balance sheet.

Kraken IPO

Clear Street is not the only crypto-linked company that’s potentially going public in 2026.

Kraken, one of the world’s biggest crypto exchanges, has confidentially filed with the US Securities and Exchange Commission for an initial public offering of its common stock, the company said in November

Kraken didn’t set a time for when the IPO will happen, but only said it expected it “to occur after the SEC completes its review process, subject to market and other conditions.”

Previous reports have predicted that Kraken would go public in the first quarter of 2026.

Eric Johansson is DL News’ managing editor. Got a tip? Email at eric@dlnews.com.

Top guns involved in dealmaking this year include tech-focused firms Paradigm and Sequoia Capital, as well as Wall Street juggernauts BlackRock, JP Morgan, and Goldman Sachs.

The most popular sectors? Centralised exchanges with $4.4 billion, prediction markets with $3.2 billion, and DeFi platforms with $2.9 billion, according to data from DefiLlama.

“The projects attracting capital today are those aligned with regulatory clarity, operational resilience, and the ability to integrate with TradFi institutions and their standards,” Jordan Knecht, head of institutional strategies at GlobalStake, the blockchain services firm, told DL News.

“In the middle of a choppy market, investors are signalling that they prefer durable, compliance-first businesses that aim to establish a long-term foundation for this asset class,” Knecht said.

Knecht isn’t alone to note that the crypto market has evolved this year.

Charles Chong, VP of strategy at crypto-native advisory firm BlockSpaceForce, told DL News that “the environment for crypto startups is shifting.”

Chong said that capital is rotating toward mature players whose revenue and unit economics justify valuation.

“None of this signals weakness; it simply reflects a market that is normalising and maturing,” he said, adding that raises are “becoming more rational, more aligned with fundamentals, and less driven by reflexive speculation.”

Georgii Verbitskii, angel investor and founder of the crypto investment firm TYMIO, told DL News that crypto is closely following the same pattern as other market cycles.

“In every major technology cycle, capital first flows into the base layer — the rails, liquidity, and settlement systems — before it moves into consumer-facing applications,” he said.

Here are some of the most notable raises this year.

Binance, $2 billion

Binance, said to be the world’s largest cryptocurrency exchange by daily trading volume, secured a massive raise of $2 billion in March. This significant capital injection was led by Abu Dhabi-based artificial intelligence and advanced technology investor MGX.

Binance CEO Richard Teng said that “this investment by MGX is a significant milestone for the crypto industry and for Binance.

Polymarket, $2 billion

Betting platform Polymarket closed a major funding round worth $2 billion in October, led by Intercontinental Exchange, valuing it around $8 billion. Once a fringe crypto‑betting site, the capital infusion reflects high institutional confidence.

Circle, $1.1 billion

Circle Internet Group, the issuer of the $76 billion stablecoin USDC, raised $1.1 billion in its June initial public offering. The blockbuster IPO was led by JP Morgan, Citigroup, and Goldman Sachs serving as joint lead bookrunners, joined by Barclays, Deutsche Bank, and Société Générale as bookrunners.

Founded in 2013, Circle has been one of the primary beneficiaries of the United States’ warming to the crypto industry.

You’re reading the latest instalment of The Weekly Raise, our column covering fundraising deals across the crypto and DeFi spaces, powered by DefiLlama.

Lance Datskoluo is DL News’ Europe-based markets correspondent. Got a tip? Email at lance@dlnews.com.

One of the world’s biggest crypto exchanges has confidentially filed with the US Securities and Exchange Commission for an initial public offering of its common stock, according to the company.

Kraken didn’t set a time for when the IPO will happen, but only said it expected it “to occur after the SEC completes its review process, subject to market and other conditions.”

Previous reports have predicted that Kraken would go public in the first quarter of 2026.

Co-CEO Arjun Sethi has publicly dodged the questions about Kraken’s plans to go public, telling DL News in September that the crypto exchange was in no rush to follow rival exchanges Gemini and Bullish to file for an IPO.

“If we were a part of what I call the pack of companies that have FOMO to go public, then we would have already filed,” he told DL News.

Kraken said it had not determined how many shares it planned to offer and at what price.

$20 billion valuation

The announcement comes hot on the heels of Kraken revealing that it had secured $200 million in a strategic investment from Citadel Securities at a $20 billion valuation.

Fortune was first to break the news.

The round comes shortly after Kraken closed an earlier round of financing in September in which it raised $600 million at a $15 billion valuation.

The investments reflect “years of work, discipline, and conviction,” Sethi said on LinkedIn. “I am proud of our team and grateful for the partners who chose to join us.”

“This journey has never been about being right in a single moment,” he continued. “It has always been about staying right over the long run.”

The new valuation puts it ahead of rivals Bullish and Gemini, who trade at $5.2 billion and $1.3 billion market caps, respectively.

Long time coming

The news that Kraken has filed a draft registration statement on Form S-1 with the SEC is seemingly the culmination of years of hints that the exchange is planning a float.

Kraken even hinted as far back as 2021 that it planned to go public, but those plans were delayed due to market downturns and conflicts with the SEC during the Biden administration.

Eric Johansson is DL News’ managing editor. Got a tip? Email at eric@dlnews.com.

On Wednesday, the firm announced the raise of an additional $35 million in a Series A funding round led by venture firms Speedinvest, CommerzVentures and Latitude. Existing investors Shapers, Headline, Chalfen Ventures, and Kraken Ventures also participated in the round.

Deblock plans to use the funds to fuel its expansion across Europe, starting with Germany as its second market after France.

“Germany’s strong adoption of digital financial services and established regulatory framework make the German market a natural next step on Deblock’s European expansion path,” the firm said in a release shared with DL News.

Deblock previously raised approximately $29 million through an initial $12 million seed round in 2023 and a further $17.5 million seed round in November 2024.

The latest raise values Deblock at around $208 million.

The round adds to the $22 billion pile of funding that investors have ploughed into crypto startups in 2025, doubling 2024’s total, according to data from DefiLlama.

Neobanking frenzy

Deblock is a so-called crypto neobank that aims to leverage blockchain technology to offer users higher yields on deposits in a bid to outcompete traditional banks.

The firm links bank accounts with self-custodial crypto wallets, giving customers access to both the traditional banking system and decentralised financial services.

“We target both crypto natives and opportunity seekers: crypto users looking for a crypto-friendly bank, and more traditional neobank customers attracted by a better yield on their euros,” Jean Meyer, CEO and co-founder of Deblock, told DL News.

But it’s not the only firm with a similar idea.

More than half a dozen new crypto neobanks have launched over the past year, banking on clearer regulations and the technological savvy of younger generations to fuel their success.

Bigger crypto firms are also muscling into the space.

Earlier this week, Aave Labs, the firm behind the $55 billion Aave lending protocol, unveiled a new savings app offering up to 9% returns on deposits.

These newer entrants will have to compete with existing neobanking giants like Chime, Revolut and Monzo, who are meeting crypto neobanks halfway by rolling out their own blockchain features.

Ambitious plans

The challenges in competing with established banking titans are something Deblock’s founders know well.

The firm’s four co-founders, Aaron Beck, Adriana Restrepo, Jean Meyer, and Mario Eguiluz, were all previously executives at Revolut.

Revolut is now one of the most valuable fintech firms in Europe, having achieved a $75 billion valuation at a secondary share sale to employees and investors in September.

Deblock’s founders are hoping to replicate that success.

Since launching in France in April last year, Deblock says it has onboarded more than 300,000 customers.

The firm has also secured several key regulatory licenses needed for its expansion plans in Germany. It is authorised as an Electronic Money Institution by the Banque de France, and was the first fintech to receive a Markets in Crypto-Assets licence from the Autorité des Marchés Financiers.

“Our goal is to create a clear and secure way to use both euros and digital assets in everyday life,” Meyer said. “These markets are critical to defining the future of onchain banking in Europe.”

Tim Craig is DL News’ Edinburgh-based DeFi correspondent. Reach out to him with tips at tim@dlnews.com.

And not even the record 43-day US government shutdown, $1 trillion of market value evaporating, and growing uncertainty about the global economy are discouraging them from ploughing even more into blockchain-based businesses.

That’s according to Eva Oberholzer, chief investment officer of venture capital firm Ajna Capital, who told DL News that sentiment is now shifting “from hype to proof” as core infrastructure “continues to attract institutional checks.”

“We are seeing a split,” Oberholzer said. “Traditional Series A rounds take longer, while community rounds fill quickly because the buyers actually use the product.”

And Oberholzer is not the only one seeing upside.

Despite turbulence, “we’re still seeing major startups like MegaETH, Polymarket or Kalshi go to market,” Shane Molidor, founder of crypto investment bank and advisory firm Forgd, told DL News.

Indeed, five crypto companies raised over $87 million in the second week of November, according to DefiLlama data.

That brings the total funding for crypto companies to over $22 billion so far in 2025, doubling 2024’s total. Codebase expects $25 billion to be doled out to crypto companies this year.

Big-name investors cutting cheques this week include Peter Thiel’s Founders Fund, known for early backing of Palantir and SpaceX, Robinhood’s venture capital arm, which rarely makes frontier investments, and Andreessen Horowitz’s crypto division.

“Investor sentiment remains cautiously optimistic,” Ron Tarter, co-founder of stablecoin issuer MNEE told DL News. “We see VCs and family offices with capital to allocate.”

Here are the crypto companies that raised the most money this week.

Lighter, $68 million

This week, trading platform Lighter raised $68 million in a new round backed by Founders Fund, Ribbit Capital, Robinhood, and Haun Ventures, Fortune reported. The deal values Lighter at $1.5 billion, making it a so-called unicorn.

Lighter is a decentralised exchange and blockchain designed for perpetual futures trading, with plans to add spot markets. It runs on a custom Ethereum layer 2 and has rapidly climbed rankings for total value locked.

Already profitable, Lighter joins a new generation of DeFi exchanges like Hyperliquid aiming to unseat centralised giants such as Binance.

Founder Vladimir Novakovski said the firm’s goal “is to build the infrastructure that guarantees transparency, fairness and correctness in all financial transactions.”

Seismic, $10 million

Crypto infrastructure startup Seismic raised $10 million in a funding round led by a16z crypto, with support from Polychain, Amber Group, LayerZero, dao5, and TrueBridge, Fortune reported. The latest round brings Seismic’s total funding to $17 million.

Seismic says it helps fintechs shield user data when transacting on public blockchains.“The entire world can see what happens onchain,” founder Lyron Co Ting Keh said. “We’re here to make sure customer data doesn’t leak in the process.”

Seismic routes transactions through private rails that prevent exposure of sensitive details, including salaries, rent, and credit history, typically revealed on public ledgers. The company’s partners include Brookwell, a stablecoin account provider, and Cred, a private credit platform. An unnamed cross-border payments client also uses Seismic to reduce transfer costs.

While Stripe-backed rival Tempo, a top competitor, raised $500 million, Co Ting Keh welcomed the competition. “If the pie is big enough, all of us eat.”

You’re reading the latest installment of The Weekly Raise, our column covering fundraising deals across the crypto and DeFi spaces, powered by DefiLlama.

Lance Datskoluo is DL News’ Europe-based markets correspondent. Got a tip? Email at lance@dlnews.com.

On Wednesday, the firm announced a $500 million strategic investment from affiliates of Fortress Investment Group, affiliates of Citadel Securities, Pantera Capital, Galaxy Digital, Brevan Howard, and Marshall Wace.

The decision to sell another $500 million in new common equity “reflects the strategic value of deepening relationships with financial partners,” Ripple said in a post announcing the raise.

The raise values Ripple at $40 billion — a more than 263% increase from the firm’s previous valuation event. In January 2024, Ripple bought back $285 million worth of shares from early investors and employees at an $11.3 billion valuation, according to Reuters.

It follows Ripple’s recent $1 billion tender offer at the same valuation.

It’s the biggest funding round since Ripple’s Series C, which closed in December 2019 and raised $200 million at a $10 billion valuation. That round was led by Tetragon and included investments from SBI Holdings and Route 66 Ventures.

Upping the ante

The raise comes amid a Wall Street crypto land grab following the passing of landmark stablecoin regulation in the US.

In September, Reuters reported that a Wall Street consortium including Apollo Global Management, Oppenheimer, Jane Street and HSG invested $500 million in crypto exchange Kraken at a $15 billion valuation.

In June, USDC stablecoin issuer Circle conducted an initial public offering that valued the firm at $6.9 billion. Investors piling into Circle’s stock have pushed that valuation up to more than $28 billion.

Ripple’s soaring valuation ups the ante for other crypto firms courting Wall Street for investment.

Ripple diversifies

Launched in 2012, Ripple styles itself as a fintech firm that leverages the XRP Ledger blockchain to provide cross-border payments, among other services.

In recent months, the firm has started diversifying its business by entering new markets in prime brokerage and treasury management.

Last month, Ripple bought GTreasury, a firm that offers corporate treasury management services, for $1 billion.

In April, Ripple spent $1.25 billion on Hidden Road, a non-bank prime broker that offers institutions clearing, prime brokerage, and financing across foreign exchange, digital assets, derivatives, swaps, and fixed income.

The acquisitions come as more and more firms look to muscle in on crypto-based cross border transfers.

Heavy hitters including Tether sister company Bitfinex, payments giant Stripe, and Circle are building new blockchains specifically for payments using US dollar stablecoins.

At the same time, existing cross border payment providers are cosying up to crypto.

Last month, Western Union, one of the largest and most well-known money transmitters, announced plans to deploy a stablecoin on the Solana blockchain.

Tim Craig is DL News’ Edinburgh-based DeFi correspondent. Reach out to him with tips at tim@dlnews.com.

Hi! Eric here.

Coinbase buying early–stage crypto investing platform Echo for $375 million this week highlights two things: first, the competition is heating up. Second, the number of mergers and acquisitions in the space is about to skyrocket.

That’s according to Wyatt Lonergan, general partner at VanEck Ventures, who told DL News that crypto startups no longer just compete within the “pretty small space” of digital assets firms, but now also against financial multi-billion-dollar behemoths.

Competing in a small space is “a lot different than if you’re competing with the 100 billion pound gorilla,” Lonergan said.

What’s changed? Well, everything.

US President Donald Trump’s pro-crypto policies have softened regulators’ policing of the industry and paved the way for industry-friendly laws.

At the same time, companies like stablecoin issuer Circle and crypto exchange Gemini have raised billions of dollars in their initial public offerings.

The combination of these factors has incentivised Wall Street giants and fintechs to muscle into crypto like never before. They’ve launched new services and recruited new talent to better compete.

Both traditional finance firms and crypto ventures alike are scooping up smaller startups that provide everything from payments to custody and infrastructure.

This growing competition means that industry native firms and outside ventures alike are actively acquiring smaller firms, essentially outbuying the competition. Thus, the surge in M&As.

Stripe, Kraken, Robinhood, and Ripple are just some of the big players that have announced acquisitions in 2025.

Over 200 such deals worth about $20 billion have already been announced this year, Karl-Martin Ahrend told DL News in September. He expected those figures to grow to $30 billion across 400 deals in 2025.

Things are looking bullish.

CZ Biden’s ‘war on crypto is over’ as Trump pardons ex-Binance CEO Changpeng Zhao

On Thursday, US President Donald Trump pardoned Changpeng Zhao, the former CEO of the industry’s largest crypto exchange, Binance, according to White House officials. Liam Kelly and Aleks Gilbert report.

Nigel Farage became the star of the crypto conference. Not everyone’s happy

The Reform Party leader has pledged to turn the UK into a crypto hotbed if elected prime minister, but not everyone in the industry is happy about his support.

Solana quietly ends support for Saga mobile phone just two years after launch

Developers behind Solana’s Saga mobile phone announced on Monday that they will stop providing vital software and security updates for the phone just two years after launch, Tim Craig reports.

Post of the Week

Concerns over the threat of quantum computing got a fresh look this week as a breakthrough from Google brings the technology much closer to being used in real-world applications.

A sufficiently powerful quantum computer could crack Bitcoin’s cryptographic algorithm putting the $2.2 trillion asset in jeopardy.

Quantum computing is basically the climate change of Bitcoin. Plenty of idiots who deny it because they can’t possibly grasp the amorphous or the astronomical, and plenty of scientists that understand it yet have no socially compelling solutions to offer.

We need Bitcoin Greta.

— Jeff Park (@dgt10011) October 23, 2025

On Tuesday, the US-based exchange announced it had acquired the early stage investing platform for $375 million in a cash and equity deal.

Coinbase has acquired @echodotxyz.

Onchain capital formation is a vital and unique part of the crypto ecosystem. Excited to be adding Echo and Sonar to Coinbase to give our customers new token access opportunities. pic.twitter.com/3XIjxMu8cW

— Brian Armstrong (@brian_armstrong) October 21, 2025

The tie-up will likely unlock more and higher-quality opportunities, Amir Hajian, a researcher at crypto market maker Keyrock, told DL News.

It’s “a major win for users,” Hajian said. “Coinbase’s 100 million plus user base creates a powerful incentive for projects to launch there.”

Echo is one of several platforms that lets individuals invest in early-stage crypto ventures that are usually reserved for institutional investors.

“You can let specific communities invest a ranged amount at cheap prices,” Kasper Vandeloock, an angel investor and adviser to several crypto trading platforms, told DL News. “Normally it’s kind of the ethos to make Echo rounds cheaper as it’s for the community.”

“It democratises early-stage investing by flipping the traditional model by empowering communities rather than gatekeeping allocation among insiders,” Hajian said.

It comes as investors’ appetite to back crypto ventures has surged to its highest point since 2022. They have poured over $21.8 billion into projects so far this year, according to DefiLlama data.

Industry experts expect that appetite will only grow thanks to the US government’s pro-crypto policies.

The return of ICOs

Investments like the ones Echo facilitates can be extremely lucrative. Those who invested in Bitfinex’s Plasma blockchain on Echo last year were able to realise a 324-fold return when its XPL token launched in September.

But early-stage investing is also extremely high risk, even for the crypto industry.

“Seed stage stuff is really difficult to invest in,” Jordan Fish, Echo’s founder, said on X in July. “Lots of projects on Echo will go to zero. In fact, I would imagine that most things on Echo will go to zero.”

Platforms like Echo aren’t the first time retail investors have been offered access to early-stage investments.

In 2017, a type of crypto investment called an initial coin offering, or ICO, exploded in popularity. These offerings skipped the need for regulatory oversight by selling blockchain-based tokens instead of equity.

But the lack of regulation meant ICOs were mired with hundreds of dubious projects, if not outright scams. They were swiftly cracked down on by the US Securities and Exchange Commission.

Industry insiders say that there’s still a need for alternative funding methods.

“The industry needed alternatives to VC-dominated launches that treat retail as exit liquidity,” Matt O’Connor, co-founder of token offering platform Legion, told DL News. “Regulatory clarity in Europe through MiCA, and shifting sentiment in the US has created space for compliant public token sales again.”

In addition to Echo’s early stage investing infrastructure, the platform also has a token launch platform called Sonar, which is more similar to previous ICOs.

Coinbase said it plans to integrate Sonar first, and plans to expand support to tokenised securities and real-world assets through Echo’s infrastructure in the future.

Echo will remain a standalone platform under its current brand for now, Fish said in an X post.

Allocation competition

Coinbase’s acquisition could have some downsides, however.

Interest in popular early stage investments on Echo is already high. Coinbase’s acquisition and the increased exposure it brings could make things even more crowded.

“Competition for allocations will intensify,” Hajian said. “As Echo opens the door to a much larger audience, each fundraising round may attract far more participants, making access to the best deals more limited.”

Hajian said he still sees the acquisition as a net positive for Echo users.

Others, such as Vandeloock, anticipate more early-stage investments on Echo from projects building on Coinbase’s Base blockchain.

“I don’t think much will change for Echo users, however I do hope they will receive a Base airdrop,” he said.

Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.

Sequoia and Andreessen Horowitz led the prediction market’s raise, with participation from other investors, including CapitalG, Coinbase Ventures, General Catalyst, and Spark Capital.

In a statement shared with DL News, Alex Immerman, partner on a16z’s Growth Fund, applauded the founders for taking “the difficult but more responsible route” of becoming regulated by the Commodity Futures Trading Commission.

The cash injection comes as prediction markets are increasingly becoming a key feature of the crypto industry.

It also highlights the growing interest among investors to back crypto-linked startups.

Venture capital firms have backed projects to the tune of $17 billion in the first nine months of 2025, outpacing 2024’s total by over $7 billion.

Competition is heating up

The raise also highlights the intensifying competition between Kalshi and its arch-rival Polymarket.

For now, it seems as if Kalshi is in the lead.

The prediction market overtook Polymarket in September by registering higher trading volumes than its competitor.

As of the week of September 29, Kalshi had over $956 million in trading volume on its platform, almost double that of Polymarket, according to Dune data.

The booming sports betting market is driving the success, according to Dustin Gouker, a sports betting consultant and predictions market analyst.

Sports betting has flourished in the US since the Supreme Court struck down a federal ban against the practice in 2018.

It’s now become a $13.7 billion market, one that prediction markets are eagerly wanting to get in on.

In March, stock-trading platform Robinhood also launched a prediction markets hub powered by Kalshi, offering contracts on sports and policy outcomes.

Users betting on Kalshi through Robinhood now account for a large chunk of Kalshi’s trading volume, Gouker told DL News in September.

Kalshi has leveraged its regulation by the CFTC, a distinction that sets it apart from its rivals.

Yet, that advantage may soon disappear.

In July, Polymarket acquired QCX, a CFTC-licensed derivatives exchange, for $112 million. In early September, the regulator granted a no-action letter to the exchange, paving the way for Polymarket to start offering its services in the US.

Crypto key for Kalshi

Kalshi already allows users to make deposits with cryptocurrencies through a collaboration with ZeroHash, but it plans to expand its remit.

That’s according to Kalshi’s newly hired crypto lead, John Wang.

“The next 10x unlock for us will be building new financial primitives for trading on Kalshi,” he said during Solana APEX, a Solana conference at the Marina Bay Sands convention centre.

“And crypto, as this global financial layer, is honestly essential to fulfilling that vision.”

He called on developers to pitch ideas ranging from pushing data onchain to tokenising Kalshi positions.

Eric Johansson is DL News’ managing editor. Got a tip? Email at eric@dlnews.com.

Local news reports on Thursday say Naver will incorporate Dunamu into its business group as a fully owned subsidiary through a comprehensive stock swap.

Naver Financial, the company’s fintech arm, will execute the stock swap by issuing shares to acquire Dunamu in full.

The stock-only structure means Naver won’t have to front the cash upfront to do the deal.

Naver’s stock price is up 11% following the news.

South Korea’s crypto market

The move carries big stakes for Naver and South Korea’s crypto market.

Upbit is the country’s largest crypto exchange and the fourth biggest globally by daily trading volume. The platform is central to the liquidity for trading major altcoins, such as XRP and Cardano.

Alongside Bithumb, Korbit, and Coinone, Upbit forms what’s called South Korea’s “big four,” the country’s four most prominent cryptocurrency exchange platforms.

Naver is also a major player in Korea’s financial market through its fintech arm, which handles $58 billion in annual payment volume.

Both Naver and Dunumu are already developing a stablecoin pegged to the Korean won, and the deal has been cast as a means to push Naver into the international market, according to news reports.

Regulatory hurdles

However, crypto trading in South Korea is heavily restricted to South Korean citizens.

The deal also underscores a global trend of internet and fintech giants steadily colonising crypto rails to expand their businesses.

From PayPal and Stripe to the likes of Kakao, Naver, and Rakuten, several internet and fintech giants have recently embedded crypto products directly into their sprawling payment and financial markets.

Osato Avan-Nomayo is our Nigeria-based DeFi correspondent. He covers DeFi and tech. Got a tip? Please contact him at osato@dlnews.com.

On Monday, newly public Strive announced it will acquire fellow Bitcoin-holding firm Semler Scientific in an all-stock deal worth over $1.3 billion.

The combined firm’s nearly 11,000 Bitcoin would lift it from 16th to just outside the top ten among public holders, according to Bitcoin Treasuries.

“This merger cements Strive’s position as a top Bitcoin treasury company, and we believe our alpha-seeking strategies and capital structure position us to outperform Bitcoin over the long run,” said Matt Cole, Strive’s chairman and CEO.

With direct Bitcoin purchases no longer driving the same upside, the path to outperforming the asset itself may run through similar mergers and acquiring smaller treasuries for their coins.

Early imitator

Michael Saylor kicked off the Bitcoin treasury trend in 2020 when his software company MicroStrategy started to hoard the cryptocurrency.

Five years and one name-change later, Strategy’s stock value is up some 2,300%.

Other firms have, understandably, tried to copy the trade. Semler was among the first companies to mimic Saylor’s playbook, launching its Bitcoin treasury strategy in May 2024, roughly a year before the field became crowded with imitators.

But the move hasn’t exactly paid off for shareholders. Semler’s stock trades a little above $30, only a few percent higher than when it first announced its Bitcoin pivot.

Shares briefly crested $80 in late 2024, after Donald Trump’s presidential victory lifted hopes of favourable crypto regulation, but the rally has long since fizzled.

The Strive–Semler tie-up isn’t the only sign of consolidation in the sector. Just last month, KindlyMD completed its merger with Nakamoto Holdings, raising $540 million through a PIPE financing to fund Bitcoin purchases.

That deal was smaller in scope, but served the same purpose: showing how corporate treasuries are pursuing growth by bolting together businesses and financing structures instead of just making direct Bitcoin buys.

And with recent reports suggesting that one in three Bitcoin treasuries have slipped below their Bitcoin value, it looks like the stock-for-Bitcoin flywheel is breaking down.

Similar mergers and acquisitions to thin the herd may be the only way forward for the top firms to justify their premiums.

Kyle Baird is DL News’ Weekend Editor. Got a tip? Email at kbaird@dlnews.com.

Fourteen companies building products around fiat-pegged cryptocurrencies have raised $537 million so far this year, according to DefiLlama data.

That’s a five-fold increase from the $84 million raised in 2024.

In July, stablecoin infrastructure venture OSL Group bagged the biggest round so far this year when the Hong Kong-based firm raised $300 million in equity funding to expand its global reach, per DefiLlama’s data.

“There’s just a buzz around stablecoins,” Anna Strebl, CEO of stablecoin payment platform Confirmo, told DL News.

She added that while getting funded has become relatively easy, “I don’t think it’s unfair hype.”

Stablecoin frenzy

The amount raised highlights the crypto frenzy that has swept across markets this year, spurred by the industry’s key regulatory wins.

Not only has US President Donald Trump supported the industry through executive orders and key government appointments, but he has also signed landmark stablecoin legislation, known as the Genius Act, into law in July.

“It was basically a green light for corporate America,” Ron Tarter, CEO of stablecoin company MNEE, told DL News, saying the law legitimised the industry.

The amount raised isn’t the only signal that things have changed for stablecoins.

This week, the total value of stablecoins in circulation passed a record $290 billion. Coinbase analysts forecast that stablecoin supply will surpass $1 trillion by 2028.

Another sign of the buzz around stablecoins can be seen in the stock market. Stablecoin issuer Circle’s $1 billion blockbuster initial public offering was executed in June.

It’s trading at four times the value at the time of its IPO.

While crypto lender Figure Technology also issued a stablecoin, DefiLlama categorises the firm as an RWA firm. Similarly, DefiLama defines Circle as a CeFi, or centralised finance, firm.

Including Circle and Figure in the mix, the stablecoin sector has raised over $2.4 billion this year.

Growing competition

Naturally, competition in the stablecoin market is intensifying.

While companies like Circle and Tether may still maintain their hard-earned market dominance, they face competition on all sides.

Not only has fintech giant Stripe announced plans to launch its own stablecoin network, but Wall Street players are also plotting similar stablecoin strategies.

Institutions now view stablecoins as “building blocks of digital finance, turning dollars from passive storage into assets that both earn and settle value,” Evgeny Yurtaev, co-founder and CEO at wallet provider Zerion, told DL News.

In June, Société Générale announced its intention to launch a US dollar-pegged stablecoin, and JPMorgan announced its own stablecoin offering called JPMD.

Elsewhere, Bank of America, Wells Fargo and Citigroup are actively exploring launching their own stablecoins, too, according to The Wall Street Journal.

Banks push back

To be sure, stablecoins startups’ success hasn’t remained unchallenged.

In August, several banking lobby groups issued a stern warning. They stated that the Genius Act granted crypto companies an unfair advantage, potentially draining over $6 trillion in deposits from lenders.

Their argument?

Though lenders will be able to issue stablecoins, they’ll be barred from paying any interest to holders. Crypto companies have no such rule holding them back, they say.

The industry, spearheaded by Coinbase’s Chief Policy Officer Faryar Shirzad, has hit back against the banking backlash.

“Deposit erosion is a myth,” Shirzad wrote in a blog, suggesting that those financial institutions are simply trying to protect their “$187 billion annual swipe-fee windfall.”

You’re reading the latest instalment of The Weekly Raise, our column covering fundraising deals across the crypto and DeFi spaces, powered by DefiLlama.

Lance Datskoluo is DL News’ Europe-based markets correspondent. Got a tip? Email at lance@dlnews.com.

The Maelstrom Fund founder has led a raise worth almost $7 million into Bio Protocol, a decentralised science, or DeSci, platform building artificial intelligence-native tools for biotech funding and drug discovery.

“Bio is about to be the category-defining launchpad which will fund scientific research the community finds appealing, not just academics,” Hayes said in comments shared with DL News. “If it works, it’s not just a launchpad — it’s the birth of an AI-native research market.”

Maelstrom anchored the raise. Mechanism Capital, Animoca Brands, and Atria Ventures also joined the raise alongside several biotech and crypto investors, Bio Protocol said.

The funding round marks Hayes’ latest support of the $896 million DeSci sector. In January, he wrote a blog encouraging “risk-takers” to support DeSci projects.

“We love undervalued dogshit,” the Maelstrom chief investment officer wrote in January, saying that the fund had already bought into tokens like VITA and that of Bio Protocol.

The new raise includes new funding from Hayes’ firm, Bio Protocol told DL News.

Bio Protocol said it will use the cash injection to strengthen its engineering, AI and regulatory muscles “to bring AI-driven decentralised science onchain.”

Its stated goal, much like the rest of the DeSci movement, is to leverage blockchain technology to create a more open, cheaper and transparent way of doing research.

“Science today is locked in institutional black boxes,” CEO Paul Kohlhaas said in comments shared with DL News. “By unifying AI, biotech, and crypto in a decentralised platform, we can compress drug development from decades to months.”

The platform lets researchers and patients deploy BioAgents — autonomous AI “co-scientists” that generate hypotheses, manage wallets, and commercialise discoveries.

The first agent, Aubrai, launched with VitaDAO and biomedical gerontologist Aubrey de Grey in August. So far, it has raised $900,000, minted 1,000 onchain hypotheses, and triggered live lab tests, according to Bio Protocol.

Lance Datskoluo is DL News’ Europe-based markets correspondent. Got a tip? Email at lance@dlnews.com.

The digital asset company called Trump Media Group CRO Strategy will be initially seeded with $1 billion worth of CRO, the native token of Cronos, a Crypto.com blockchain subsidiary. The remainder will mostly be held as an equity line of credit for additional CRO purchases.

The CRO treasury company plans to run a validator node on the Cronos blockchain, according to the terms of the deal. Validators are participants on blockchains like Cronos who stake their tokens and secure the blockchain while earning fees for processing transactions.

The company will delegate all of its CRO tokens to the validator to earn native staking rewards.

CRO tokens surged 30% on Tuesday on the news, even as the broader cryptocurrency market slipped this week.

Devin Nunes, CEO of Trump Media, said the company was “bullish on cryptocurrency” even as the digital asset treasury trend spreads across companies of all sizes.

The deal first sparked backlash from some Cronos token holders who said it would dilute the value of their investments when it was first proposed in March.

That’s because it involved the reissuing of 70 billion CRO tokens, currently worth almost $14 billion, that were previously burned, a term for when cryptocurrencies are removed from circulation. Token burns are typically permanent.

Reissuance increased the token’s supply to 100 billion CRO tokens, from 30 billion, a 233% increase.

Crypto treasury companies

The deal puts CRO, the 30th-largest cryptocurrency by market value as the latest crypto to be adopted in the digital asset treasury trend that has become popular in corporate America. Companies are diversifying their balance sheets by adding cryptocurrencies to their corporate reserves.

It’s a broader trend pioneered by Michael Saylor, founder of Strategy, formerly MicroStrategy, who started acquiring Bitcoin in August 2020. Strategy holds the largest Bitcoin treasury among all publicly-traded companies with about $70 billion worth of the asset on its balance sheet.

Strategy’s stock price has soared more than 2,000% since it began stockpiling Bitcoin, while the cryptocurrency itself has surged about 10-fold since then.

That success continues to spawn numerous imitators with companies like BitMine and SharpLink that are stockpiling Ethereum, while others like Sharps Technology are holding Solana. On Tuesday, Pantera Capital announced plans to raise about $1.25 billion to seed a US-listed Solana treasury company.

Many of these companies issue debt or shares to raise capital to buy their preferred cryptocurrency.

Earlier in August, ALT5 Sigma Corporation announced plans to raise $1.5 billion from a stock sale to buy WLFI, the native token of World Liberty Finance, a Trump-backed DeFi project.

Osato Avan-Nomayo is our Nigeria-based DeFi correspondent. He covers DeFi and tech. Got a tip?. Please contact him at osato@dlnews.com.

AI-focused crypto projects raised $516 million in the first eight months of the year, a 6% uptick from the total amount raised in 2024, according to DefiLlama data. It’s the highest amount raised in this market segment, according to the database.

Major institutional investment firms including Bitwise, Pantera, Sequoia, and Binance Labs have poured money into AI crypto projects this year.

Bitwise senior investment strategist Juan Leon predicted the “megatrend” could add $20 trillion to global GDP by 2030.

Crypto giants like Coinbase — with its launch of its x402 stablecoin payment protocol that allows AI agents to transact online — are also heavily investing in the space.

The ballooning funding into these efforts come as the buzz around the technology — especially generative AI models such as OpenAI’s ChatGPT, X’s Grok, or Midjourney — has reached fever pitch.

AI is undeniably booming. NVIDIA, Google, Amazon, Microsoft and Meta are all heavily invested into the technology.

Investment bank Morgan Stanley has estimated that AI has the potential to add almost 30% to the long-term valuation of the S&P 500 index, which would translate to up to $16 billion in additional value.

To be sure, 95% of AI pilot programmes have failed to achieve rapid revenue acceleration, according to a recent report from the Massachusetts Institute of Technology.

Moreover, Sam Altman, the CEO of OpenAI, recently signalled that an AI bubble might be forming, saying that “some investors are likely to lose a lot of money.”

Crypto and AI

Yet, those invested in the intersection of AI and crypto remain bullish.

AI is creating “entirely new asset classes” such as datasets, fine-tuned models, and autonomous agents, Sean Ren, a computer science professor at the University of Southern California and CEO of crypto startup Sahara AI, told DL News.

The convergence of AI and crypto is “extremely varied,” Maxim Legg, CEO of dataset firm Pangea, told DL News.

“We see projects innovating in the fields of compute, privacy, robo-advisory, training, optimisation — just to name a few.”

One of the key markets being tackled is access to computing power. Graphic processing units, the chips that power AI and computers in general, are scarce and concentrated in the hands of a few tech giants.

That makes it harder for smaller AI firms to innovate, which is a problem blockchain projects can help to solve, some argue.

“AI is moving faster than just about anything we’ve seen, but it’s running into a brick wall: there just aren’t enough GPUs,” Trevor Harries-Jones, director of the Render Network Foundation, told DL News.

The pitch Render and others make is to tap into GPUs all over the world and make “them available to anyone who needs them,” Harries-Jones said.

“The winners will be those that build useful applications, not just hype,” Legg said.

Lance Datskoluo is DL News’ Europe-based markets correspondent. Got a tip? Email at lance@dlnews.com.

On Wednesday, Peter Thiel-backed crypto exchange Bullish made its market debut by securing $1.1 billion after the stock surged 228% to $118, giving it a $10 billion market cap on the first day of trading.

It joined other crypto companies, including Galaxy Digital and Circle, that have gone public this year.

The IPO made up the bulk of the $1.2 billion raised by crypto companies since August 8, according to DefiLlama. That brings the total raised by industry players in 2025 to $14.4 billion, 51% more than they did in 2024.

And more could come, partially thanks to successful IPOs like Bullish’s.

“Having seen these public IPOs or acquisitions at higher valuations, people now have the proof points to invest with a level of confidence in early-stage, real-world blockchain companies that they may not otherwise have had in the past,” Michael Martin, director at Ava Labs’ incubator Codebase, told DL News earlier in August.

Martin and other investors have said that they expect the industry to raise $25 billion in 2025.

The wave of public listings comes amid growing optimism in the crypto industry.

They have reason to be hopeful.

This year has seen Bitcoin and other cryptocurrencies hit new records, the Trump administration push through new crypto-friendly regulations, and Wall Street embrace blockchain-based projects like never before.

In short, the market conditions couldn’t be better for crypto companies to go public.

Investors have an incentive for them to go public, as it would enable the backers to cash in on their investments.

“Many VCs and private equity firms have held these positions for years,” Kat Liu, vice president at IPO research firm IPOX, told Reuters.

And it’s not just crypto companies that are going public. There have been over 200 IPOs on US exchanges so far this year, according to StockAnalysis data.

Here’s a small sample of crypto companies that have either announced or are reported to go public in the near future.

Gemini

In June, the Winklevii finally filed to go public.

Gemini, the crypto exchange run by Bitcoin billionaires Cameron and Tyler Winklevoss, announced on June 6 that it had confidentially filed to go public with the Securities and Exchange Commission. It’s one of the initial steps many companies take before they go public.

So far, the details of the IPO — the when and for how much — remain non-public.

Still, the announcement capped years of hints that Gemini would go public, stretching as far back as 2021.

BitGo

In July, BitGo, one of the industry’s largest crypto custodians, said it planned to go public in the US in a filing with regulators.

The California company follows a slew of summer filings ranging from Grayscale, the crypto fund manager, to the exchanges Bullish and Gemini.

Grayscale

In July, Grayscale said it had submitted a draft S-1 registration statement to the SEC. In layman’s terms, that means the crypto-focused asset manager is gearing up to go public.

You’re reading the latest installment of The Weekly Raise, our column covering fundraising deals across the crypto and DeFi spaces, powered by DefiLlama.

Eric Johansson is DL News’ interim managing editor. Got a tip? Email at eric@dlnews.com.

On Monday, ALT5 announced plans to pivot to become a so-called crypto treasury company, selling 200,000 new shares and using the proceeds to buy up the $1.5 billion worth of WLFI.

The firm will swap half of the newly-issued shares directly for WLFI held by World Liberty Financial in a deal that values the token at $0.20, Matt Morgan, ALT5’s chief investment officer, told DL News.

It’s not clear if World Liberty Financial is the only participant swapping WLFI tokens for shares. The firm said that several other unnamed institutional investors and venture capital firms participated in the share sale.

It’s the first time that WLFI has received a valuation since World Liberty Financial sold $550 million worth tokens to investors between October and March. At the time, investors paid varying prices for WLFI depending on how early in the sale they bought it.

Large WLFI holders include Tron founder Justin Sun, who bought $75 million worth during the token sale.

On its launch, WLFI was programmed so that buyers couldn’t trade it, meaning that there was no way for the market to value the token.

Conflict of interest

The deal also highlights the growing crypto treasury company trend.

Michael Saylor’s Strategy was a trailblazer in this regard. The firm has issued debt or shares to buy Bitcoin since 2020, a ploy which has seen its shares skyrocket by over 3,500% since.

Over the past year, a new wave of crypto treasury companies have copied Saylor’s playbook on the back of a favourable crypto regulatory environment under the Trump administration.

Many of these companies issue debt or shares to buy up their cryptocurrency of choice, and often emerge through reverse mergers with struggling publicly traded companies.

Sometimes there’s a conflict of interest between the treasury companies and the issuers of the crypto asset they buy.

Tron Inc, a crypto treasury company that says it will buy up TRX, the native token of the Tron blockchain, has Weike Sun on its board, the father of Justin Sun. The firm listed the father-son relationship among its potential conflicts of interest in its S-3 filing last month.

As a part of ALT5’s crypto treasury swerve, the firm added several World Liberty Financial executives and backers to its board of directors. They include World Liberty Financial CEO Zach Witkoff, the project’s COO Zak Folkman, and Eric Trump, President Donald Trump’s son.

All three new appointees hold WLFI and therefore have a financial interest in the token’s value.

Morgan said he’s not at liberty to comment on matters that may involve commercially sensitive information relating to his role or ALT5 when asked about the potential conflict of interest of the board appointments.

Trading the token

The WLFI token is designed to govern World Liberty Financial. Those who hold the token can vote on changes to the protocol, its creators said.

The project makes clear that it isn’t a decentralised autonomous organisation, a type of crypto collective popular among DeFi projects.

In July, WLFI holders voted to make the token tradable after the question was put to them by the project’s creators.

World Liberty Financial said in an X post that the token could begin trading as soon as the end of August.

Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.

That’s according to Michael Martin, director at Ava Labs’ incubator Codebase, who said a perfect storm of bullish signals will incentivise investors to back crypto companies.

He told DL News that factors like Circle’s successful public float, booming crypto market, Stripe’s acquisition of Privy, Wall Street pouring into blockchain projects, and new rules of the road for digital assets will drive even more investment in the last half of the year.

“People have the proof points to invest with a level of confidence in earlier stage, real-world blockchain companies that they may not have had in the past,” Martin told DL News.

The prediction comes during a week that saw 12 crypto projects raise $121 million, pushing the total amount bagged by industry players this year to $13.2 billion, according to DefiLlama.

That investment is already 40% higher in August this year than all investment into crypto last year. That also puts it on the path to break the $18 billion expected by PitchBook analysts earlier this year.

Martin’s prognosis echoes that of Galaxy Venture’s Mike Giampapa, who told DL News earlier this summer that he expected crypto startups to secure $25 billion in 2025.

Critical juncture

Investor’ optimism comes at a critical juncture for the industry.

The Trump administration’s pro-industry tilt has emboldened not just sector players, but also larger financial institutions and banks to increasingly tap into digital assets.

With Trump having rubberstamped the Genius Act in July and more crypto bills coming up for votes on Capitol Hill, the industry is getting the clarity it’s clamoured for for years.

That clarity is expected to further fuel the adoption of blockchain technology by traditional financial institutions. Wall Street companies and fintech firms may also see this as an opportunity to follow in Stripe’s footsteps and acquire crypto companies to embed their solutions in their services

“You’re going to see more of that,” Martin said.

Macroeconomy risks

To be sure, there are clouds on the horizon that risk derailing the investment boom.

Even so, macroeconomic uncertainties — particularly those surrounding US President Donald Trump’s tariffs — jeopardise the rally, Martin said.

Other concerns include whether or not public crypto companies like Circle and Coinbase will perform as well as expected.

Martin said that if public crypto companies and leading cryptocurrencies like Bitcoin were to underperform analysts’ expectations, that could rattle investors and scare them into tightening their grips around their cheque books.

Apart from the risk of public crypto companies underperforming, there is also a chance that macroeconomic conditions will give investors reason to halt their investment strategies.

For instance, Trump’s tariffs against some of the US’ closest trading partners combined with jobs growth having stalled this summer have rattled investors. No one knows what will happen next.

“VCs have capital they need to deploy,” Martin said. “But how are you going to deploy it if you don’t know if X, Y and Z is going to happen?”

You’re reading the latest installment of The Weekly Raise, our column covering fundraising deals across the crypto and DeFi spaces, powered by DefiLlama.

Eric Johansson is DL News’ interim managing editor. Got a tip? Email at eric@dlnews.com.

In July, 65 crypto projects raised over $2.6 billion in new investments to grow their businesses, according to DefiLlama.

That brings the total amount raised by industry players to $13 billion so far this year, up from the $9.5 billion raised in total in 2024.

Pitchbook expects crypto startups to double that figure to $18 billion in 2025.

Here are the three crypto projects that raised the most money in July.

Pump.fun, $590 million

Pump.fun raised $590 million in an initial coin offering at the beginning of July to, as it boldly proclaimed, “kill Facebook, TikTok, and Twitch” by transforming itself into a new type of social media platform.

At a glance, the controversial memecoin generator token sale seems a grand success. Pump.fun’s ICO sold out in just 12 minutes, capping off one of the fastest and largest raises in recent crypto memory.

However, the project sold 2 billion fewer tokens than it had originally planned.

The project had previously said 150 billion PUMP tokens, out of a 330 billion total ICO allocation, would be offered to the public at $0.004 each.

That implied a $600 million raise. But the live dashboard confirms just 148 billion tokens were sold, pulling in $590 million — about 98% of the originally stated public allocation.

The sale came in the same month as the platform is struggling with plummeting revenue amid a memecoin slump and an increasingly crowded market.

And those traditional social media platforms? Meta, the parent company of Facebook and Instagram, saw its stock price surge 11% this week, giving it a market cap of just under $2 trillion, about half of the entire cryptocurrency market.

OSL Group, $300 million

Hong Kong-based OSL Group said it has secured $300 million in equity financing.

“The funding will accelerate our global buildout — particularly in regulated payment infrastructure and access points,” Ivan Wong, CFO at OSL Group, said in a statement.

Upexi, $200 million

Upexi, a Solana treasury company, announced a $200 million deal led by Big Brain Holdings at the beginning of July.

The deal took the form of a convertible note offering, and the proceeds will be used to buy more Solana, the company said.

Upexi is part of a wave of crypto treasury companies that have cropped up over the past year. While the bulk of them copy Michael Saylor’s Bitcoin-buying strategy, many are also allocating resources to buying altcoins.

You’re reading the latest installment of The Weekly Raise, our column covering fundraising deals across the crypto and DeFi spaces, powered by DefiLlama.

Eric Johansson is DL News’ interim managing editor. Got a tip? Email at eric@dlnews.com.

The haul brings total crypto startup funding for the year to nearly $11 billion — already surpassing 2024’s total by more than $1 billion. Industry players have already raised $583 million in July alone.

If the pace continues, the industry is on track to blow past PitchBook’s $18 billion prediction for 2025.

This week’s standouts? Firms expanding their Bitcoin treasuries.

Of the seven projects that raised money this week, two are adding more Bitcoin to their balance sheets. Both are part of a broader wave of companies copying the scheme of Michael Saylor’s Strategy.

Below are the three largest funding rounds from last week:

H100 Group, $54 million

Stockholm-based ​​H100 Group bagged $54 million to continue building out its Bitcoin treasury.

The publicly traded company — listed on the Nasdaq First North — is building a longevity-focused ecosystem that merges digital health with decentralised infrastructure.

While H100’s primary focus is health and wellness, the firm touts itself as Sweden’s first Bitcoin treasury company.

The firm now holds 294 Bitcoin worth about $32 million.

H100’s raise this week is a dramatic uptick from when it took in just over $2 million in May.

Agora Finance, $50 million

Agora has become the latest startup to ride the stablecoin wave. The company raised $50 million this week in a round led by Paradigm, Fortune reported.

The AUSD stablecoin issuer says it plans to use the latest cash injection to better compete against rivals like Circle andTether.

The timing of the announcement is notable. It comes just days ahead of Washington’s “Crypto Week” that kicks off on Monday, during which the Trump-backed Genius Act is expected to be voted in.

If passed, the new law is expected to unleash a tsunami of fresh capital into the stablecoin sector.

DigitalX, $13 million

Australian crypto asset manager DigitalX raised $13.7 million in a round backed by Animoca Brands, ParaFi Capital, and UTXO Management.

While the company disclosed total commitments of about $20 million, only $13 million was finalised this week.

The funds will go toward expanding DigitalX’s Bitcoin treasury, which currently holds 262 Bitcoin or about $29 million in direct and exchange-traded fund exposure, according to Bitcointreasuries.net. When the round is fully closed, that figure is expected to climb above 500 Bitcoin.

“This strategic investment marks a significant milestone for DigitalX as we continue to focus on Bitcoin as the core of our treasury strategy,” said interim CEO Demetrios Christou in a statement.

You’re reading the latest installment of The Weekly Raise, our column covering fundraising deals across the crypto and DeFi spaces, powered byDefiLlama.

Pedro Solimano is the publication’s Buenos Aires-based markets correspondent. Got a tip? Email at psolimano@dlnews.com.

“We’ll end somewhere in the [$20 billion to $25 billion] range,” Mike Giampapa, general partner at Galaxy Ventures, told DL News.

PitchBook, the investment research firm, shared that optimism and estimated the industry will raise $18 billion in 2025. That would double the $9.6 billion raised in 2024 — an amount the industry has already surpassed this year, according to DefiLlama.

The bullishness comes at a critical juncture for the industry.

After the Biden administration’s crypto crackdown, the sector has found itself in a state of metamorphosis. Having long been relegated to the outskirts of finance, it’s increasingly accepted by Wall Street as a legitimate industry.

Bullish signals

Buoyed by US President Donald Trump’s pro-crypto administration and industry-friendly legislation, bullish signals are on the rise.

Both Bitcoin and altcoins’ prices have reached record highs, stablecoin issuer Circle’s IPO soared to levels not seen since the dotcom boom of the 1990s, fintechs have bought crypto firms, and banks are exploring the launch of their own stablecoins.

But with the lines between crypto and traditional finance beginning to blur, the approach of VCs has changed, investors told DL News. They’ve updated how they judge prospective startups, and shared what it’ll take for the days of 2021, when investors injected $36 billion into the industry, to return.

‘Fundamentals matter — there has to be a proper, real business.’ Jonas Kristensen

The crypto funding boom coincides with a new wave of founders.

In a break from previous cycles, founding teams aren’t dominated by native-crypto members, but also entrepreneurs from other sectors, Wyatt Lonergan, general partner at VanEck Ventures, told DL News.

VanEck Ventures, for instance, has backed teams that include ex-bankers or tech workers at companies like OpenAI who bring blockchain technology into traditional finance and other industries, he said.

They are “starting to tie the tech world and the crypto world together — it’s not its own island anymore,” Lonergan said.

Founders who can demonstrate how to merge those worlds will have an advantage in the funding race, investors said.

Other areas of interest include the cross-pollination of crypto and AI, better user experiences, and innovative crypto-trading platforms.

Key for those firms to get funding, however, is that they can demonstrate the viability of their business. That means investors will look at metrics like revenue, distribution, and active users.

“The general sentiment in 2025 is that fundamentals matter when investing — there has to be a proper, real business,” Jonas Kristensen, head of Wintermute Ventures, told DL News.

The FTX effect

FTX was a gift in disguise, Kristensen said.

To him, the downfall of Sam Bankman-Fried’s crypto empire and other scandals purged bad actors from the industry and forced crypto companies to level up their compliance credentials.

But it came at a cost. Big investors burnt by the scandals withdrew from crypto to focus on areas like AI that promised greater yield and smaller risk. They’re unlikely to return to crypto any time soon, Giampapa said.

The absence of those big deployers of capital is one of the reasons why investors say they don’t expect funding levels to return to the heights of the last cycle, at least not yet.

Another reason is that limited partners, the investors that invest in VC funds, are also more hesitant to back crypto investments this time around. VCs are betting that those backers will eventually return.

“LPs are smart and where good opportunities are popping up, capital will form,” Giampapa said. “We’re still in a bit of a digestion period before that capital does actually form.”

The scandals also incentivised investors to look for founders willing to disclose holdings and deals akin to how startups in other sectors do.

“We know from history that if you set up a system where it can be gamed and you can hurt people, then people will take advantage of it,” Lonergan said. “There are smart, cutting people out there.”

Finally, the scandals armed anti-crypto firebrands like Senator Elizabeth Warren and former Securities and Exchange Commission Chair Gary Gensler with fresh ammunition.

According to the investors we spoke with, founders became more hesitant to launch and market crypto businesses out of fear of drawing the SEC’s ire.

They had reason to be worried. During the Gensler year, the agency fired off a barrage of law enforcement actions against crypto companies such as Ripple, Coinbase, and Kraken.

The regulator ended most of those lawsuits after Trump was elected, which encouraged entrepreneurs to explore crypto opportunities more openly, Lonergan said.

“Those shackles are off,” he said.

You’re reading the latest installment of The Weekly Raise, our column covering fundraising deals across the crypto and DeFi spaces, powered by DefiLlama.

Eric Johansson is DL News’ interim managing editor. Got a tip? Email at eric@dlnews.com.

It won’t stop there, according to Ripple Chief Technology Officer David Schwartz.

“Our M&A people are very busy,” the executive told DL News in New York.

“We have multiple potential acquisitions in various different stages, from early stages to late stages.”

Ripple is the creator of the XRP Ledger, a blockchain that runs on XRP. The cryptocurrency had a market value of $124 billion Thursday, making it the fourth-largest, behind Bitcoin, Ethereum, and Tether’s USDT stablecoin.

The company has been aggressively courting traditional finance, pitching XRP and its new stablecoin, RLUSD, as assets designed to facilitate cross-border payments.

In April, Ripple acquired Hidden Road for $1.25 billion. The crypto firm said it would use RLUSD as a collateral across Hidden Road’s suite of brokerage services.

Previously, Ripple acquired the crypto custody firms Metaco for $250 million and Standard Custody for an undisclosed amount.

In January, a spokesperson told DL News the firm was “actively seeking companies to purchase.”

Crypto M&A

Schwartz said Thursday those efforts are ongoing — and buoyed by a relative lack of interest from titans of traditional finance.

“There’s a unique opportunity right now for cryptocurrency companies to acquire companies that create strategic value, like the Hidden Road acquisition,” he said.

“And we’re definitely aggressively looking for those opportunities, because it seems like Wall Street hasn’t quite caught on yet. … They’re not competing to acquire the companies that could give them a leg up in these spaces.”

Crypto mergers and acquisitions have soared this year. But they have been largely limited to crypto-first companies and fintechs eager to expand crypto offerings to their base of retail traders.

Last month, Coinbase acquired crypto options exchange Deribit in a $2.9 billion cash and stock deal, and Robinhood bought Canadian exchange WonderFi for $250 million Canadian dollars in an all-cash deal.

In March, US-based crypto exchange Kraken acquired NinjaTrader, a retail futures trading platform, for $1.5 billion.

And in January, Circle, the company that issues the USDC stablecoin, bought Hashnote, the world’s largest tokenised treasury fund.

XRP Ledger

Unlike other, more flexible blockchains on which developers are free to deploy virtually any kind of application, the XRP Ledger is tightly controlled and features only a small number of applications — a design choice meant to ensure user funds aren’t siloed across a variety of exchanges and lending platforms, Schwartz said.

Nevertheless, his team is currently working to make it more flexible, or “programmable,” in developer parlance.

“I don’t think you’re going to see, even in the medium term, the full programmability,” he said.

“We like the fact that we have a niche where we have things like concentrated liquidity. But what we’re looking at is, can we get some of the benefits of programmability without the downsides?”

The XRP Ledger could, for example, soon feature smart contracts that manage payments, converting the crypto a payee receives into their preferred digital asset, Schwartz said.

Ripple is also building a lending protocol for the XRP Ledger, set to debut in the the third quarter of the year, pending approval of “validators” who confirm transactions on the blockchain.

“There’ll be somebody offchain, who curates the set of borrowers, who sues them if they don’t repay, or who handles repayment arrangements if they declare bankruptcy or whatever,” Schwartz said.

“And then the ledger can tokenize your interest in the repayments and handle the distribution of the repayment. Which is sort of a nice split between TradFi on the frontend and DeFi on the backend.”

Ripple has made a flurry of announcements in June, including the debut of tokenised treasuries, an institution-friendly decentralised exchange, and a partnership with Wormhole, a so-called crypto bridge that allows for the movement of crypto assets across otherwise incompatible blockchains.

Aleks Gilbert is DL News’ New York-based DeFi correspondent. You can reach him at aleks@dlnews.com.

The CEO of Komainu, a crypto custodian, said he’s looking to scoop up crypto companies across the world to either get a foothold in new regions or to open up additional business lines.

And there’s plenty of opportunities to go around as crypto downshifts into its richest bull market since 2021.

“The industry is in a state now where nearly everything is for sale. I’ve never seen anything quite like it,” Frost-Smith told DL News in a wide-ranging interview.

Komainu’s goal? To “become the dominant digital asset service provider outside of the US,” Frost Smith said.

That’s a tall order.

$75 million raise

While Komainu says it has “well over $10 billion” assets in custody and bagged $75 million in a Series B raise in January, it isn’t the only bank-backed custodian offering its services to international institutional clients like banks and governments.

Rivals such as Zodia Custody are similar in size, and also have offices in many of the same regions that Komainu is targeting.

Komainu declined to provide a valuation.

Acquisitions appear to be a key piece of both companies’ growth strategy.

In October, Komainu agreed to acquire Propine Holdings, a Singapore based crypto custodian. In May, Zodia Custody announced plans to buy Tungsten Custody, a Dubai-based firm.

‘There’s an awful lot of concentration risk in Coinbase at the moment.’

Paul Frost-Smith

Frost-Smith declined to offer details about how much Komainu is willing to spend on acquisitions or how it plans to fund them. He said that, apart from tapping into the funds provided in the January raise, it has access to “other funding if needed.”

It’s not just crypto custodians that are looking to make deals — the entire crypto industry is in a state of consolidation.

In May, Messari estimated that there had been almost 120 mergers and acquisitions worth about $8 billion in 2025, which means crypto M&As are set to hit levels not seen since 2021.

Firms like Stripe, Coinbase, Ripple, Robinhood, and Kraken are among the bigger players to have bought smaller startups this year.

What’s Komainu’s deal?

Komainu first launched in 2018 as a joint venture by Nomura, the Japanese financial services group; CoinShares, the digital asset firm; and Ledger, the crypto hardware developer.

Komainu is named after the mythical lion-dog statues that guard Shinto temples.

Komainu’s team of roughly 70 employees are spread across its headquarters in Jersey, one of the Channel Islands, and offices in the UK, Singapore, and Dubai. It is also opening an office in Italy.

In Asia, Komainu is looking to be fully operational in Singapore and Japan over the next six to nine months, the company’s CEO said.

Frost-Smith said he expects his staff to increase to about 120 people by the end of the year — which would bring it in line with Zodia Custody’s staff numbers.

US opportunity

Frost-Smith is bullish about the US.

Since Donald Trump was elected president, the country has grown more welcoming for crypto firms. That’s created an opportunity for Custodians like Komainu.

“There’s an awful lot of concentration risk in Coinbase at the moment,” he said, noting that eight of nine US Bitcoin exchange-traded fund issuers custody with the crypto exchange.

“There are very good arguments to say that that custody base should be split among several custodians [to spread the risk,]’ Frost-Smith said.

A company spokesperson added: “Komainu sees its main competition coming from the US and is taking steps to ensure it is the go-to provider outside the US.”

Even so, the main priority for Komainu is to expand its business in Asia.

Komainu is also toiling to get licensed under the European Union’s new Markets in Crypto-Assets, or MiCA, regime.

“It’s less of an important market for us than Asia,” Frost-Smith said, adding that the firm doesn’t want to lose the few European clients that it has, which is why Komainu is pursuing the licence.

Withdrawing from the UK

Across the English Channel, the UK government has signalled a move to introduce new crypto-specific laws and regulations.

CryptoUK, the industry body, has welcomed this push, even though those rules will require crypto companies to ramp up background checks on users to avoid being used for money laundering or other financial crimes.

More oversight may run counter to the prized tenets of financial privacy at the heart of crypto.

Even so, Komainu registered with the Financial Conduct Authority, the UK’s key financial markets regulator in 2023. Frost-Smith warned that the firm may leave the UK if the FCA’s new proposed rules prove too costly.

“We would consider withdrawing from the UK,” Frost-Smith said, noting that no decision one way or another has been made.

“The regulators here need to be a little bit careful that they don’t make things so different and so onerous that they force sensible, conservative operators like ourselves out of the market,” he added.

Update June 20: A previous version of this story incorrectly suggested that Komainu has an office in the US. It doesn’t, but operates in the States through its Jersey licence.

Eric Johansson is DL News’ managing editor. Got a tip? Email at eric@dlnews.com.

Hi! Eric here.

Venture capitalists are bullish.

That’s pretty much the takeaway from DL News’ reporting and conversations I’ve had with investors this week.

VCs are on course to invest $18 billion in crypto startups this year, which is almost double the level in 2024.

The reasons are plentiful. Jonas Kristensen, head of Wintermute Ventures, the popular liquidity provider’s investment arm, said President Donald Trump’s pro-crypto policies are clearly a boost. So, too, is the entry of traditional financial institutions to the sector.

While investors in past cycles may have thrown money at anything and hoped something would stick, market maturity is now spurring VCs to analyse key metrics such as revenue, distribution, and user bases.

“The general kind of sentiment in 2025 is that fundamentals matter when investing,” Kristensen told me. “There has to be a proper, real business.”

So what are investors betting on?

Kristensen is looking at the blending of fintech and crypto. As financial institutions are using crypto-native solutions like stablecoins, that also means they’ll have to look at things like custody and compliance.

Liam Kelly spoke to VCs on the sidelines of Berlin Blockchain Week this week who said they’re exploring how blockchain can be combined with AI agents. They are also hunting for startups that are building sites with user experiences that are easy to navigate, as well as innovative trading platforms.

Let the good times roll.

Komainu CEO eyes deals to push beyond custody amid crypto M&A boom

Crypto custodians are part of a bigger mergers and acquisitions boom. I spoke with Komainu’s CEO to hear more.

Project Eleven: VCs throw $6m at project securing Bitcoin against quantum threats

Quantum computers are threatening the security of all industries, including crypto. Tim Craig wrote about how one startup just raised $6 million to protect Bitcoin wallets.

Genius Act clears Senate in historic vote for stablecoins as focus turns to House

The landmark Genius Act passed the Senate this week, Aleks Gilbert reported. It now has to pass the House before it can be turned into law and set the stage for a stablecoin bonanza.

In a post on X, Ravindra Kumar denied accusations on social media that he had sold vested allocations of various crypto tokens to investors that never existed.

“I’ve been accused of serious wrongdoing, which is completely false,” Kumar said Friday. “My legal team and I are working on a statement to address this matter.”

Fraudulent deals

On Thursday, Mohammed Waseem, the CEO of Aza Ventures, an Indian over-the-counter deals broker, revealed that his firm unwittingly helped mediate dozens of fraudulent deals over the course of several months.

“We have been scammed,” Waseem said on Telegram. “There is no easy way to say it, but it is what it is.”

He said a figure he referred to as “Source 1” sold vested crypto tokens for multi-billion dollar projects such as Sui, Near, Axelar, and Sei at steep discounts and under favourable conditions.

Although early deals were legitimate, Waseem said, later ones “shifted entirely to Ponzi schemes.”

When the time came for Source 1 to transfer tokens to buyers, they kept delaying, leading to several buyers to raise the alarm.

Waseem said he chose to keep Source 1’s identity private because he believed it gave himself and investors the best chance of recouping their investments.

But suspicions mounted online that Kumar was Source 1. With his denial, Kumar appeared to confirm this.

‘Stop falling for scammers selling you OTC deals. There is NO deal.’

Adeniyi Abiodun

The scam has hit the crypto industry’s wealthiest cohort of investors who often look to invest over-the-counter in the vested tokens of early-stage projects because of the potential for outsized returns.

Over-the-counter, or OTC, refers to trading of assets done directly between two parties, and without the supervision of an exchange.

It’s usually the only way to sell illiquid assets such as large tranches of vested crypto tokens.

Multiple warnings

Before Waseem informed investors about the fraud, several crypto project founders warned about phoney deals involving their tokens.

“Stop falling for [Telegram] scammers selling you OTC deals. There is NO deal.” Adeniyi Abiodun, co-founder of Mysten Labs, the firm behind the Sui blockchain, said in an X post in May.

Later that month, Lucian Mincu, Co-founder of MultiversX, another project impacted by the phoney OTC deals, posted a similar warning.

Smokey The Bera, the pseudonymous founder of the Berachain blockchain, said he had previously told Waseem that OTC deals involving Berachain’s BERA token weren’t legitimate.

“He insisted that his sources were good, and wouldn’t cooperate with any investigation,” Smokey said.

Refund plans

Waseem has assured victims that he plans to issue refunds to everyone who got ripped off.

How he will do so isn’t clear.

The Aza Ventures CEO said he has already exhausted all of his personal funds trying to maintain distributions under the assumption that Source 1 would eventually pay him.

He also told investors that Source 1 said they will begin to return funds by the end of June.

Waseem also said that he had been in contact with the authorities in India, who confirmed that Source 1 was running a Ponzi scheme and committed to assisting him in the refund process.

“I did not do this knowingly,” he said. “I have been taken for a ride myself.”

Tim Craig is DL News’ Edinburgh-based DeFi correspondent. Reach out to him with tips at tim@dlnews.com.

The venture capital giant’s crypto arm, known as a16z crypto, backed both EigenLayer and PrismaX’s rounds.

The deals topped up $928 million a16z crypto has deployed in the crypto sector this year. That’s about a tenth of the total VCs have invested in crypto startups in 2025, according to DefiLlama data.

The venture capital firm’s investment came as the overall industry received $155 million across 15 deals between June 14 and 20.

That brings the total money injected into the industry to almost $9.4 billion, just $200 shy of the total raised in 2024 and on course to meet analyst expectations of it hitting $18 billion this year.

Here are the three biggest funding rounds of the last week:

EigenLayer, $70 million

On Wednesday, Eigen Labs, the engineering and research organisation behind the popular Ethereum restaking protocol EigenLayer, raised $70 million.

The raise took the form of a token purchase from a16z crypto. The deal follows its previous backing of Eigen Labs’ $100 million Series B round in February 2024.

PrismaX, $11 million

On Wednesday, PrismaX announced that it had raised $11 million in a seed round led by a16z, Crunchbase reported.

Other investors included Volt Capital, Virtuals Protocol, Symbolic Capital, Stanford Blockchain Accelerator, and Blockchain Builders Fund.

The startup is building a decentralised data incentive mechanism to promote the standardisation of robotics vision data and the development of remote control infrastructure.

Gradient Network, $10 million

Also on Wednesday, Gradient Network announced the completion of a $10 million seed round.

Pantera Capital and Multicoin Capital led the raise and HSG (formerly Sequoia Capital China) and “other distinguished partners,” also participated in the raise according to a press release.

Gradient is building a decentralised AI infrastructure for open-source intelligence.

You’re reading the latest installment of The Weekly Raise, our column covering fundraising deals across the crypto and DeFi spaces, powered by DefiLlama.

Eric Johansson is DL News’ News Editor. Got a tip? Email at eric@dlnews.com.

On Thursday, the group of cryptography experts announced the seed round, which was co-led by Variant Fund and Quantonation. Nic Carter’s Castle Island Ventures, Nebular, and Formation also participated.

It’s not entirely clear how Project Eleven plans to monetise its goal, but Alex Pruden, Project Eleven’s CEO and co-founder, said he was confident there was money to be made.

“If you don’t believe there’s a business opportunity somewhere in that $2 trillion — say, to build wallet infrastructure to help wallets manage the migration for users — then I think you have to be pretty bearish on Bitcoin and crypto generally,” Pruden told DL News.

The raise comes as quantum computing experts warn that Bitcoin could be at risk from cryptography-cracking quantum computers in as little as five years time. Yet so far, there’s no concrete plan to upgrade the blockchain to make it resistant to quantum computers.

“The entire Bitcoin protocol needs to be re-architected, tested, and every single wallet needs to migrate to a secure protocol,” Pruden said. “If that doesn’t happen then I guess the $2 trillion of value in Bitcoin goes to zero.”

Bitcoin development is conducted by a loose group of core developers who contribute to the project, often alongside other jobs. Private companies, NGOs, and wealthy Bitcoiners support them via grants and donations.

Some Bitcoin developers are already independently exploring ways to secure the blockchain against quantum computers.

Securing Bitcoin

The first facet of the Bitcoin protocol at risk from quantum computers are old Bitcoin wallets that use outdated cryptography, which includes Bitcoin creator Satoshi Nakamoto’s $115 billion stash.

However, eventually quantum computers will be able to crack the cryptography used in newer wallets, too.

Project Eleven’s aim is to eventually secure all Bitcoin wallets with so-called exposed public keys.

When a user sends Bitcoin, they must expose their wallet’s public keys. Normally this isn’t an issue as public keys are encrypted. However, with the advent of sufficiently powerful quantum computers, these exposed public keys become a target because they can theoretically be cracked.

Project Eleven estimates approximately $600 billion worth of Bitcoin in such wallets will be at risk in the future.

Ahead of a more permanent solution, the company aims to protect wallets with exposed public keys by enabling users to claim provenance over their funds using post-quantum cryptography.

To do this, Project Eleven is launching Yellowpages, a cryptographic registry designed to help Bitcoin holders prove ownership of their funds.

“With Yellowpages, we’re giving users free, audited, and open-source tools to proactively establish quantum-resilient ownership today,” Conor Deegan, co-founder and vice president of engineering at Project Eleven, said in a statement.

Yellowpages won’t solve the Bitcoin protocol’s vulnerability to quantum computers, but it will provide a fallback solution, allowing users to secure their Bitcoin holdings without immediate on-chain transactions or reliance on protocol upgrades.

Quantum advancements

Quantum computers exploit quantum mechanical phenomena to produce so-called qubits, the basic unit of information in quantum computing.

The quantum properties of qubits mean they can theoretically be used to create computers that are orders of magnitude more powerful than those that use conventional methods, meaning they could break advanced cryptography that secures encrypted data.

But quantum computers are difficult to build. The more qubits a quantum computer utilises, the more difficult it is to run computations with producing errors.

For many years, the development of quantum computers has been slow. But in recent months, several advancements have been made.

In December, Google unveiled a new quantum computing chip called Willow, which boasts a 56% improvement over the tech giant’s previous chip.

Then in February, Microsoft announced its own chip that it says solves the scaling issues that have persistently plagued the field.

Unconvinced

Yet some Bitcoin advocates, like Strategy Chair Michael Saylor, are unconvinced of the threat of quantum computers.

“I don’t worry about it,” Saylor told Bloomberg News on June 10. “Microsoft and Google market their quantum projects, but they would never sell a quantum computer that cracked cryptography as it would destroy their own companies.”

Pruden, on the other hand, believes Bitcoin will be future quantum computers’ number one target.

“An economically motivated actor will 100% go for Bitcoin versus something else like a bank,” Pruden said.

With Bitcoin, cryptography is the entire mechanism of ownership. Banks on the other hand, have a lot of legal and operational controls that could thwart a potential quantum computer attacker, he said.

Like other experts, Pruden estimates that quantum computers will pose a threat to Bitcoin within five to 10 years time.

“That’s probably how long it will take to fix and migrate everything,” he said.

Tim Craig is DL News’ Edinburgh-based DeFi correspondent. Reach out to him with tips attim@dlnews.com.

On Wednesday, the $91.5 billion fintech giant announced its purchase of the crypto wallet provider, but didn’t disclose the financial details of the deal.

It’s another step towards Stripe’s goal of building out a crypto payments ecosystem to tap into the $251 billion stablecoin market, according to Matthew Mena, a crypto researcher at 21Shares.

“Privy gives Stripe the missing puzzle piece: user-facing wallet infrastructure,” Mena told DL News. It “rounds out what’s becoming a full-stack crypto infrastructure play.”

Stablecoin blueprint

The move follows the payment giant’s previous acquisition of Bridge, a stablecoin infrastructure firm, in February.

Stripe is in the vanguard of traditional financial firms tapping stablecoins and blockchains for payments.

If Stripe’s crypto strategy pays off, it could drive a new wave of adoption and provide a blueprint for other firms to follow.

The stablecoin market is growing at its fastest pace since 2021, adding over $50 billion since the start of the year. It recently reached an all-time high of $251 billion in circulation.

“As infrastructure matures and user demand grows, we expect the stablecoin market to expand rapidly, potentially reaching $1 trillion by as early as next year,” Mena said.

And it’s just the start. Ripple and Boston Consulting Group estimate that tokenised assets will grow to a $19 trillion business over the next eight years.

Stripe isn’t the only non-crypto native firm excited about the potential of stablecoin payments.

Just last week, Uber, X, Airbnb, and Apple all reportedly began exploring stablecoin integrations.

PayPal and SpaceX are already using them in production, and banks such as Santander and Société Générale have launched their own, Mena said.

‘Reality is most people won’t interact with traditional crypto wallets.'

Adam Morgan McCarthy, Kaiko

“There is a lot of excitement around the stablecoin use case among traditional financial institutions,” Katalin Tischhauser, head of research at Sygnum Bank, the digital asset bank, told DL News.

The eye-popping performance of the Circle IPO and Stripe’s strong build up in the space are recent demonstrations of this, she said.

If stablecoins continue to see increased adoption, it could also benefit the underlying blockchains that facilitate stablecoin issuance and transfers.

Ethereum, which currently hosts nearly half the stablecoin market, could see a surge in activity and fee revenue as new users interact with stablecoins through consumer apps without even realising they’re using blockchains, Mena said.

It’s still unclear which blockchain stands to benefit the most. Stripe currently lets users accept stablecoin payments on Ethereum, Solana, and Polygon.

Why Privy?

Firms like Stripe are adopting crypto rails for payments to harness speed and efficiency benefits and become less dependent on centralised banking infrastructure.

But getting such a system working is difficult. Companies need to decide on which blockchain to use, which stablecoins to support, and provide their users with infrastructure to navigate the new system.

Unlike other non-custodial wallets like MetaMask, Privy abstracts much of the complexity of using a crypto wallet away. Privy’s clients include NFT platform OpenSea and restaurant loyalty startup Blackbird.

“Reality is most people won’t interact with traditional crypto wallets,” Adam Morgan McCarthy, a research analyst at Kaiko, told DL News.

“Integrating this tech seamlessly with existing user interfaces is the game changer.”

The acquisition aligns closely with Stripe’s core business which is to simplify and expand digital payments for businesses and consumers, Satish Patel, an analyst at CoinShares, told DL News.

M&A boom

Stripe’s purchase also adds to the growing number of high-profile crypto acquisitions in recent months.

In June, Robinhood completed its $200 million acquisition of Bitstamp, the crypto exchange.

In May, Coinbase paid $2.9 billion for crypto options exchange Deribit. And in January, USDC issuer Circle bought Hashnote, the world’s largest tokenised treasury fund.

Stripe hasn’t disclosed the details of the Privy acquisition. However, Privy was valued at $230 million in March 2025, according to PitchBook data.

“It is likely [Stripe] paid a healthy premium above this valuation, reflecting Privy’s growth and the buoyant state of the crypto market,” Patel said.

Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.

Dubbed Stable, the project is backed by crypto exchange Bitfinex and by USDT0, a business affiliated with Tether that lets users bring the stablecoin to otherwise incompatible blockchains.

Tether CEO Paolo Ardoino is advising the project.

Stable is being marketed to financial institutions, rather than retail users.

A key selling point will be so-called “enterprise lanes” that promise faster execution of transactions.

“USDT alone settles over $100B daily,” Stable developers wrote on X. “However, the current infrastructure is volatile, costly, and fragmented.”

Real-world apps

It wasn’t immediately clear who’s behind the project. A thread on X detailing the forthcoming blockchain said only that the team comprised “protocol engineers, fintech operators, and crypto founders.”

Stable did not immediately return DL News’ request for comment.

Stablecoins are crypto tokens pegged to the value of another asset, most often the US dollar.

They are among the most utilised real-world applications of crypto technology. They’ve gained a foothold in some developing economies as a store of value. Some of the world’s largest financial institutions — and, controversially, the family of US President Donald Trump — are experimenting with stablecoins.

Tether is the world’s largest, with a market value of $154 billion. Circle’s USDC is a distant second, with a market value of $61 billion.

Shares in Circle soared after the company went public this week on the New York Stock Exchange.

Tether is enormously profitable: Last year, it recorded $13 billion in profits stemming from its holdings of Bitcoin, gold, US Treasury bonds, and other financial instruments.

But it has also been controversial.

The stablecoin is popular with Mexico-based criminal organisations, the US Treasury Department said in a report last year.

And it has emerged as a bogeyman among crypto-sceptic lawmakers amid debates over stablecoin legislation this year.

Earlier this year, Tether said it would move its headquarters to El Salvador, the Central American country led by a controversial Bitcoin-boosting president, after acquiring the country’s Digital Asset Service Provider licence.

Aleks Gilbert is a DeFi correspondent based in New York. He can be reached at aleks@dlnews.com.

The performance tops up a run that’s already raised more than $7.7 billion in 2025.

In line with prior weeks, investors focused on infrastructure projects aimed at scaling Ethereum, quantitative trading, and enhancing Bitcoin’s capabilities.

Here are two top funding rounds this week:

Neutral Trade, $2 Million

Neutral Trade, an onchain hedge fund platform operating on Solana, raised $2 million from investors, including Skyland Ventures, Enzyme, BlackPine, and several DeFi focused angels.

The platform offers delta neutral and multi strategy vaults designed for accessibility, with a minimum deposit of just $100 and on-chain transparency across all positions.

It features vaults ranging from fixed income stablecoin strategies to thematic indices.

According to Neutral Trade, the raise will be used to support expansion across Ethereum, layer 2s, and centralised exchange ventures.

LayerEdge, $1 Million

LayerEdge completed a public token sale for its EDGEN token, raising $1 million.

The token launched with a circulating supply of 20%, giving it a fully diluted valuation of $1 billion at launch.

The project builds infrastructure for a decentralised internet secured by Bitcoin, leveraging optimistic rollups and a Hybrid Modular Data Availability layer.

Its proprietary operating system, edgenOS, aims to make node participation accessible on everyday devices.

The sale included a wallet cap of 0.1 ETH per participant and allocated all funds directly to onchain liquidity, according to the project.

The performance was some 62% higher than the investments made last week, the data showed.

The key deals: investments in Auradine, a blockchain infrastructure venture, and ZenMEV, a DeFi startup.

So far this year, there’s been about $7 billion in deals, according to DefiLlama.

Let’s dive in:

Auradine, $153 million

Auradine’s massive Series C round clearly wins the size competition this week. It was led by the US-based StepStone Group, with the Samsung Catalyst Fund, Mara Holdings, Maverick Silicon, Qualcomm Ventures, and others also participating.

Auradine, founded in 2022, produces a range of infrastructure specifically built for blockchains and artificial intelligence that includes semiconductors and networking and security software.

“Our dual focus on Bitcoin and AI infrastructure places Auradine at the intersection of pivotal technologies that will reshape computing and energy utilization for decades to come,” Rajiv Khemani, co-founder and CEO of Auradine, said in a statement on the news.

ZenMEV, $140 million

The week’s second-largest round is also a doozy, and with only one participant: VentureX, which has funded Uniswap, Ethereum, Chainlink, Solana, and other notable blue-chip crypto projects.

ZenMEV is looking to reorient a dark corner of crypto: “Maximal extractable value,” or MEV.

This is the practice of using bots to rearrange blockchain transactions before they’re finalised to extract profit from crypto traders.

The company sees itself as “reinterpreting MEV from a potential risk into a new source of income for users,” Valen Marcus, co-founder and CEO, said in a statement. It does so through ZenBots Shield, a product that uses “AI-driven analysis, and transaction bundling to optimize MEV-derived income.”

World Liberty Financial, $25 million

Crypto market maker DWF Labs, which DL News has covered previously, was the only participant in this strategic funding round.

The investment in the purported DeFi venture associated with the Trump family was executed through the purchase of $25 million worth of WLFI, the token of World Liberty Financial.

The round serves double duty as DWF Labs’ establishment of a US base in New York City.

“The U.S. is the world’s largest single market for digital asset innovation,” Andrei Grachev, managing partner of DWF Labs, said in a statement.

World Liberty Financial dubs itself a “decentralized finance protocol and governance platform inspired by President Donald J. Trump.” The project currently holds nearly $100 million in crypto assets, according to Arkham Intelligence.

Meanwhile, $40 million

Meanwhile is a crypto company that focused on life insurance policies.

The venture aims to be the only life insurance company “denominated in Bitcoin” and offer customers a way to hedge against future unknowns by betting big on the most valuable cryptocurrency.

”Even though life insurance is a critical part of long-term financial planning, it hasn’t been integrated with a major part of the modern financial system: cryptocurrency,” the company states.

The Series A round was led by Framework Ventures and fulgur.ventures, with participation from Wences Casares.

You’re reading the latest installment of The Weekly Raise, our column covering fundraising deals across the crypto and DeFi spaces, powered by DefiLlama.

Update May 1: This story has been updated to reflect that about $7 billion had been raised by crypto projects at the time of the original publication of this story.

Andrew Flanagan is a markets correspondent for DL News. Have a tip? Reach out to aflanagan@dlnews.com.

The tie up, which makes PayPal the latest stablecoin issuer to ink a deal with the US-based exchange, comes with a coveted boon.

Coinbase users can convert their holdings between PayPal’s PYUSD stablecoin and dollars one-to-one with zero-fees.

Until now, Circle’s USDC was the only stablecoin to benefit from such a deal.

“This does not change our existing relationship with Circle – instead it pushes the entire stablecoin ecosystem forward,” a Coinbase spokesperson told DL News.

“We’re committed to accelerating global adoption of stablecoin payments, and our partnerships with both Circle and PayPal are key to making that happen.”

Coinbase suggests there’s room for everyone. Indeed, the stablecoin market is booming, hitting an all-time high of $237 billion this month.

But competition is fierce.

Giving users the ability to swap from dollars into a stablecoin without having to pay fees removes a big hurdle. Other stablecoins on Coinbase, like Tether’s USDT, don’t benefit from fee-less dollar conversions.

Coinbase says it also aims to leverage its infrastructure to expand support for stablecoins to PayPal’s merchant partners, and will explore new use cases onchain utilising PYUSD.

Excited to work more together @acce 🤝! https://t.co/Kkzfqm4d8D

— Brian Armstrong (@brian_armstrong) April 25, 2025

Coinbase has held a minority stake in Circle since August 2023.

Stablecoin land grab

PayPal launched its PYUSD stablecoin in 2023.

Since then, it’s tried many ways to boost adoption. It experimented with so-called DeFi bribes on decentralised exchanges like Curve, and gave out lucrative incentives to PYUSD users on Solana lending protocol Kamino.

On Wednesday, PayPal announced that customers who hold PYUSD on its app or Venmo can earn 3.7% annually.

These initiatives have found moderate success. PYUSD is now the ninth-biggest stablecoin with $888 million in circulation.

But that’s still far below industry titans Tether and Circle, which have $146 billion and $62 billion in circulation respectively.

The Coinbase deal is significant because it’s PayPal’s first major partnership with a centralised crypto exchange, where the majority of crypto trading happens.

Circle’s new network

On April 21, Circle announced plans to build Circle Payments Network, an in-house service using its USDC stablecoin designed for invoice payments, remittances, treasury services, and payroll and contractor payouts.

It’s bad news for Circle’s partners and those who build similar apps using USDC, Zaheer Ebtikar, founder of crypto hedge fund Split Capital, said on X.

“Building in the stablecoin space will get materially more competitive if the issuer is entering the capture zone and not evangelising darling projects,” he said.

Such a strategy could sideline exchanges and DeFi apps that have already built similar payments products around USDC.

Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.

While the strategy seems simple enough, the investment prospectus lists an appendix outlining dozens of risks, and many are beyond the boilerplate industry pitfalls like the volatile nature of crypto and an uncertain regulatory landscape.

The venture, dubbed Twenty One, offers shares of the listed company to ride gains in its stash of 42,000, or $3.9 billion’s worth, of Bitcoin.

But it does so via a publicly listed venture with no real operations. Shareholders won’t have much actual ownership like pure Bitcoin holders do, nor do they have any say in how the company operates.

There’s also big competition, another risk Twenty One acknowledges.

Michael Saylor’s MicroStrategy has soared even in rocky markets, while about a dozen Bitcoin exchange-traded funds run by giants including BlackRock and Fidelity have lured billions from a range of new investors.

“What’s the value-add here?” asked Bloomberg ETF analyst Eric Balchunas on X. “Why buy this new stock?” over other offerings.

Below are some of the biggest, and most unusual, risks Twenty One highlights.

What’s the mission again?

It’s an unusual business model.

Twenty One says its mission is to “accelerate Bitcoin adoption and Bitcoin literacy” among both pros and the masses. It wants to make money from these efforts as well. So the company’s fortunes aren’t driven solely by Bitcoin’s price but also by getting clients to pay for ancillary services such as education.

And that’s a risk.

“We have not previously engaged in the business of online learning programs and educational content, and growing these operations could be difficult for us, including, without limitation, due to operational challenges and significant competition.”

Also: “If we fail to attract and retain customers for our educational business segment, our operating results may suffer.”

Howard Lutnick

The involvement of Cantor Fitzgerald in the venture deepens ties with the Wall Street firm and crypto industry.

Brandon Lutnick, the son of Howard Lutnick, the longtime Cantor CEO who recently stepped down to become the secretary of Commerce in the Trump administration, is spearheading the new venture.

It’s not clear how much Howard Lutnick owns in Cantor, but the holdings are big enough to be a risk.

“In connection with his confirmation as the 41st Secretary of Commerce, Howard W Lutnick has stated his intention to divest his interests in Cantor and its affiliates to comply with US government ethics rules. We cannot predict the consequences of this divestiture.”

Lutnick has 90 days from his confirmation to dump the relevant holdings. In an ethics agreement, Lutnick said he “will not repurchase any asset I was required to divest without consulting with my agency ethics official and the US Office of Government Ethics.”

He said the same goes for his wife and “minor” children, which presumably excludes adult son Brandon.

Insiders win

Twenty One says it hopes to qualify as a controlled company, meaning a small group or entity owns more than half of the voting power for the election of directors.

Twenty One thus “expects to avail itself of applicable exemptions from the corporate governance requirements.”

Also, holders of the company’s Class A Common Stock have no voting rights. The statement says holders “will not have any ability to influence stockholder decisions.”

Tether

The company says it will rely on Tether International S.A. deCV, an affiliate of Tether Investments, which “will have a controlling interest” in the new venture.

Tether, the company behind the world’s most widely traded cryptocurrency, has come under fire for its lack of transparency — it reports attestations in lieu of the same level of audits most financial firms undergo.

This is why the company continues to be dogged by questions about what instruments it uses to back its USDT stablecoin on a one-to-one basis.

It’s also not a US company. It was founded in 2014 in Hong Kong, but plans to establish a headquarters in El Salvador. Moreover, Tether has opted to not comply with crypto regulations in the European Union, which has prompted exchanges to delist USDT.

Then there’s the popularity of USDT with organised crime and drug traffickers. US members of Congress have decried the stablecoin’s use for financing the movement of fentanyl.

In 2021, it settled an investigation with the New York State Department of Financial Services over misleading claims about its reserves.

Through its voting control of Twenty One, the statement says Tether is “in a position to control actions that require shareholder approval and may make decisions that are adverse to other shareholders.”

How regulators will scrutinise an opaque foreign company’s control over a publicly listed US stock is unclear.

Fizen, a Hong Kong-based startup that previously raised $1.2 million from investors, styles itself as a payments “super app” that focuses on practical applications for crypto, such as topping up mobile phone credit, or buying movie tickets.

“Tether’s investment in Fizen underscores our commitment to expanding global access to efficient and reliable digital financial solutions that promote the informed responsible use of digital assets in everyday life,” Tether CEO Paolo Ardoino said in a press release.

Third deal

The Fizen investment marks Tether’s third major deal since this year. It’s also a shift from the stablecoin giant’s recent offbeat investments, many of which had little to do with crypto.

Last month, Tether invested $11 million in media company Be Water in exchange for a 30% stake in the firm.

In February, Tether acquired a minority stake in Juventus, the Italian Serie A football club. The same month, Tether also bid $385 million for the complete ownership of a South American farming firm which it partly owns.

The slew of investments comes after Tether reported an eye-watering $13 billion gain from its reserves in 2024.

Ardoino told DL News in an interview in 2024 that Tether is constantly reviewing investment opportunities but is very choosy about what it pursues.

Strategic investors

As the issuer of USDT, Tether is the top stablecoin issuer worldwide. USDT, which has $145 billion in circulation, accounts for 62% of the entire stablecoin market.

It joins other strategic investors in Fizen, including blockchain development company Sotatek, Vietnamese software development company VNext, and Viction, formerly known as TomoChain.

Previous fundraising efforts took the form of selling Fizen tokens to investors. It’s not clear whether Tether’s strategic investment was for ownership in the company or crypto tokens.

Tether did not immediately respond to a request for comment.

Hot sector

Crypto payments is fast becoming a hot sector.

In January, US crypto exchange Kraken launched Kraken Pay, a service that allows users to send payments using either crypto or fiat currencies.

Last year, UK-based fintech Revolut expanded its offerings with a crypto payments card.

Fintech firms will increasingly integrate with crypto rails to offer faster, cheaper, and more efficient financial services — like payments — to their customers, Mike Giampapa, a general partner at Galaxy Ventures, previously told DL News.

Fizen’s plan is to offer crypto payments without users even realising they are using blockchain technology, Leo Vu, founder and CEO of Fizen, said in the release.

“The technology infrastructure is already in place,” he said. “We lack consumer-friendly applications.”

Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.

The deal, revealed by Monica Long, the crypto firm’s president, will see Hidden Road integrate Ripple’s new stablecoin called RLUSD across its business.

Launched in December 2024, RLUSD has grown to be worth almost $300 million, according CoinGecko.

Tether, the industry’s largest stablecoin issuer at $144 billion, is 480 times larger. Circle’s stablecoin, the second largest, is 200 times bigger.

Long expects the splashy acquisition of London-based Hidden Road will help close that gap.

“This is an order of magnitude larger in terms of volume opportunity,” Long said on stage at Paris Blockchain Week on Tuesday. “Hidden Roads clears $3 trillion a year for its clients.”

By using RLUSD as a collateral across Hidden Road’s suite of brokerage services, Ripple is banking on a different variety of user than its heavyweight counterparts to help grow its dollar-pegged cryptocurrency.

“We have our sites set on use cases for RLUSD that makes sense for institutions,” Long said.

Ripple’s coffers, primarily held in the cryptocurrency XRP, have soared the last quarter and boosted the company’s acquisition hunt.

As of its latest financial attestation in January, the firm holds more than $82 billion in XRP tokens, the majority of which are held in escrow.

And as the company’s legal concerns in the US clear — the Securities and Exchange Commission dropped its lawsuit against Ripple in March — it’s turned its attention to growth via acquisitions.

A spokesperson told DL News in January: “We have been active in the mergers and acquisitions space and expect to be more active moving forward.

Over the last two years, Ripple has acquired crypto custody firms Metaco for $250 million and Standard Custody for an undisclosed amount, but the Hidden Roads acquisition is its biggest ever.

The move to buy up other companies also offers Ripple an alternative growth strategy.

Mentioned in the same breath as buzzy crypto listings, Long addressed lingering IPO rumours on Tuesday.

“IPO makes more sense for a company where you’re looking for more liquidity,” she said.

“That’s not our constraint to growth right now, so we’re more focused on growing the business as a private company and M&A and organically and organically.”

But backlash in the crypto industry has been swift.

That’s because the crypto exchange and its subsidiary Cronos Labs also said they will reissue some $7 billion worth of their native Cronos tokens that were burned in 2021.

Burned tokens in crypto are supposed to be permanently destroyed, but in Crypto.com’s case, they can be re-minted to fund the Trump media deal.

Cronos whales with huge voting power swayed a governance vote last week to reissue the tokens, despite widespread opposition from holders who fear the move will dilute the value of their investments.

2021 plan

Back in 2021, the decision to burn the tokens was part of a deflationary effort to improve value.

Now, the tokens are being resurrected, and critics say the move erodes faith in the project.

“This isn’t just about Cronos, it’s about trust in blockchain. If one chain reverses token burns, where does it end?” Sam Grilli, chief operating officer at blockchain gaming outfit Kepithor Studios, posted.

‘Bold plan’

Other critics also questioned the timing of the move.

In an announcement last week about the vote to reverse the token burn, community members were told of a “bold plan” to support Cronos and its ETF as part of “America’s ambition to become the world capital of crypto.”

The reissued tokens will be set aside in a so-called strategic reserve to support Cronos' roadmap, which includes the ETF deal.

The tokens will swell the Cronos supply to 100 billion coins, worth some $10 billion.

Critics were quick to jump on the link between the vote and the Trump Media announcement on Monday.

Neither Crypto.com nor Trump Media responded to requests for comment.

Fault lines

A US president’s business endeavours raise conflict of interest concerns. The controversy also exposes deep fault lines in crypto, especially in the outsized influence of whales in corporate governance.

Almost 80% of the wallets that participated in the vote were against the proposed token recovery.

However, they only controlled 20% of the voting power.

This week’s backlash isn’t the first time Crypto.com has drawn controversy.

In 2020, Crypto.com fielded criticism from investors who were forced to swap the exchange’s former token MCO for Cronos. At the time, token holders deemed the swap unfavourable.

Cronos is up 22% on Tuesday, but it’s still down 90% from its peak price of $0.96 achieved in 2021.

Trump Media shares jumped almost 9% in New York trading.

Osato Avan-Nomayo is our Nigeria-based DeFi correspondent. He covers DeFi and tech. Got a tip? please contact him at osato@dlnews.com.

The deal has the potential to supercharge its expansion into options trading and intensify its rivalry with US competitors Robinhood and Kraken

Deribit — licensed in Dubai and the largest platform globally for Bitcoin and Ether options — could be valued between $4 billion and $5 billion.

An acquisition would mark Coinbase’s most aggressive push yet into derivatives, an increasingly lucrative segment of the market.

Deribit processed nearly $1.2 trillion in volume last year, showing that there is high demand for advanced trading products like options and futures.

Coinbase has long dominated US spot markets, but Robinhood’s $200 million acquisition of Bitstamp, announced last June, includes plans to roll out staking, stablecoins, and more tokens.

Bitstamp lists about 100 tokens and has deep ties to institutional players, positioning Robinhood to enter the international derivatives and staking arena.

While Robinhood has received praise for its rapid product development, Coinbase is benefitting from surging trading volumes and tailwinds from pro-crypto US policy.

“Coinbase remains the dominant platform to ride the tailwinds,” Bernstein recently wrote, adding that perpetual futures and other new trading products could soon gain US approval.

Kraken, meanwhile, has taken a different route — acquiring traditional futures broker NinjaTrader in a $1.5 billion deal announced on Thursday.

The purchase gives Kraken a CFTC-registered license and opens the door to offering crypto futures in the US.

Kyle Baird is DL News’ Weekend Editor. Got a tip? Email at kbaird@dlnews.com.

The stablecoin issuer made a bid to buy a majority stake in Adecoagero, a listed company that owns hundreds of thousands of hectares of farmland across South America, according to a document filed with US regulators on Tuesday.

The farming concern produces food products and generates more than 1 million megawatts of renewable electricity.

The $385 million deal may appear unusual for Tether, whose USDT offering dominates the global stablecoin market.

Yet flush with $13 billion in gains from the reserves it maintains to back up USDT, Tether appears to be focused on diversifying its business.

Tether’s deal flurry

This month, Tether bought a minority stake in Juventus, the Italian Serie A football club. It also invested another $775 million in Rumble, an online video platform popular among right-wing users, in December.

Last April, it invested $200 million into a company developing technology that lets people control computers with brain signals.

Tether already holds a 20.2% stake in Adecoagero, which is based in Luxembourg.

Its holding company is listed on the New York Stock Exchange, and the firm’s shares jumped more than 12% after Tether offered to acquire the company at a 13% premium to its current stock price.

‘Operational challenges’

Adecoagro’s declining profitability and increasing debt load were “operational challenges,” Tether said in a letter submitted as part of its offer.

This should make its offer attractive to shareholders, the stablecoin issuers said.

Neither Adecoagro nor Tether immediately responded to a request to comment.

Paolo Ardoino, CEO of Tether, told DL News in an interview in 2024 that the company is constantly reviewing investment opportunities but is very choosy about what it pursues.

He said agriculture and food sustainability is a key focus at Tether, which is moving its global headquarters to El Salvador in Central America.

Liam Kelly is a Berlin-based reporter for DL News. Got a tip? Email him at liam@dlnews.com.

Despite total funding holding steady at $10 billion in 2024, the number of deals fell 14% to 351, according to investment research firm PitchBook.

Investors poured capital into early-stage startups, doubling median valuations to $52 million year-over-year, while late-stage firms secured just 5% of all funding rounds.

PitchBook described 2024 as a year of “growing investor selectivity” and expects consolidation among infrastructure providers, exchanges, and custody firms. Venture capitalists are particularly keen on two sectors: stablecoins and artificial intelligence.

Artificial intelligence

The AI sector is heating up.

Crypto-native and traditional VCs showed “outsized interest” in AI-related blockchain projects, a trend that gained momentum in the latter half of 2024.

The AI-crypto sector now boasts a $55 billion market valuation, with analysts predicting it could contribute an additional $20 trillion to the global economy by 2030.

Stablecoins

Stablecoins also remain a major draw for investors.

The sector has swelled to a $231 billion market valuation, with Tether’s USDT and Circle’s USDC ranking among the top 10 largest cryptocurrencies. Tether dominates with nearly 70% market share and has evolved into a financial powerhouse, posting $13 billion in profits last year.

Regulatory attention is intensifying.

On Tuesday, US Senator Bill Hagerty introduced a bill to establish rules for stablecoin issuers. Meanwhile, Donald Trump’s crypto adviser David Sacks signaled that passing stablecoin legislation is a priority for the administration.

Pedro Solimano is a markets correspondent based in Buenos Aires. Got a tip? Email him at psolimano@dlnews.com.

The crypto firm holds more than $143 billion in XRP — the majority of which is in escrow — according to its latest financial attestation.

Now, with crypto top of mind in the US, the company wants to put that money to work.

“Ripple is actively seeking companies to purchase,” a spokesperson told DL News. “We have been active in the mergers and acquisitions space and expect to be more active moving forward.”

Trump’s world

The election of Donald Trump has galvanised the crypto industry as the president-elect names crypto-friendly players to key posts in his administration.

Bankers have said they see an uptick in mergers across various sectors, helped by what they see as a more permissive regulatory environment.

In the last two years, Ripple has acquired the crypto custody firms Metaco for $250 million and Standard Custody for an undisclosed amount.

But which sectors are ripe for consolidation?

Ripple stablecoin takes flight

As the stablecoin market heats up and new entrants compete for digital dollar dominance, at least one Ripple executive predicts a key deal-making phase in the niche this year.

The high cost of compliance for operating in the US is kicking off a “war of attrition” among smaller stablecoin upstarts, Jack McDonald, the crypto firm’s stablecoin lead, told DL News. McDonald was the CEO of Standard Custody before Ripple acquired it.

“I’m already in conversations with some startups deciding that this is going to be a hard business to compete in and are offering to sell their company already,” said McDonald, referring to the competitive landscape.

He declined to elaborate on his discussions with those companies, adding only that Ripple will be “specific” in its deal hunt.

Still, the meetings are lining up.

“I’ve gotten pinged twice in the last two weeks from small startups that people want to meet,” he said.

Ripple plunged into the competitive stablecoin business in late December, launching its RLUSD token onto a handful of exchanges.

The limited rollout has already generated market buzz.

Over the last day, the RLUSD stablecoin recorded seven times more trading volume than PayPal’s offering, according to crypto price tracker CoinGecko.

But Ripple is far from being a serious contender in the niche.

At just $72 million, RLUSD is roughly an eighth of the total value of PayPal’s stablecoin and nowhere near stablecoin stalwarts like Tether and Circle.

Tether’s stablecoin is worth $137 billion, and Circle’s is worth $46 billion.

Liam Kelly is a Berlin-based reporter for DL News. Got a tip? Email him at liam@dlnews.com.

This acquisition secures a Cyprus Investment Firm license, enabling Coinbase to offer contracts for differences and passport its services across European Economic Area member states.

CFDs allow investors to speculate on the price movements of assets without owning them, making them an attractive option for professional and institutional clients.

Yorick Naeff, CEO of BUX, confirmed the sale, stating, “We are pleased with the sale of BUX Europe Limited, to Coinbase, a globally recognised leader in the crypto industry.”

The move comes as Coinbase navigates Europe’s new Markets in Crypto-Assets Regulation.

MiCA provides firms with clarity but imposes stricter rules, such as requiring e-money token issuers to hold EU authorisation.

Industry groups have warned that the limited time to comply with MiCA could lead to “serious customer detriment and negative financial consequences across all EU member states.”

These changes have already prompted Coinbase to end its USDC rewards programme for EEA residents and delist unauthorised stablecoins.

Acquiring BUX’s Cyprus unit positions Coinbase to comply with MiCA while expanding its European footprint.

The CIF license allows Coinbase to target professional and institutional clients under the unified framework, potentially giving it an edge over competitors like Binance, which has faced regulatory setbacks.

Crypto market movers

• Bitcoin is down 0.2% over the past 24 hours to trade at $97,815.
• Ethereum is up up 0.9% over the same period to $3,620.

What we’re reading

• Coinbase lawyer reveals fresh evidence of FDIC crypto industry ‘pause letters’ ― DL News
• How Chinese Lending Firm Cango Became a Bitcoin Mining Powerhouse ― CoinDesk
• Crypto wallet Phantom quashes airdrop rumors after social feature launch, Sui support announcement ― The Block
• Crypto Might Get Reality Check from Friendly U.S. Congress — Unchained
• The top DeFi trends to watch for in 2025 ― DL News

Kyle Baird is DL News’ Weekend Editor. Got a tip? Email at kbaird@dlnews.com.

That’s according to VC firms and market watchers DL News has spoken with ahead of the new year.

But what will drive the rally and how much cash are investors looking to splash out?

Read on to find out.

Mike Giampapa, general partner, Galaxy Ventures

With the most pro-crypto executive and legislative branches in US history coming into place, it’s hard to overstate the impact this can have on the crypto industry.

With a more favourable SEC, we expect to see fewer enforcement actions, more regulatory clarity, and an increased likelihood for blockchain businesses to be able to go public in the US.

We are also more optimistic than ever about banks being more open to engaging with crypto, the introduction of stablecoin legislation, and a broader crypto market infrastructure bill.

These measures would create the necessary transparency, guardrails, and protections for entrepreneurs and users across the industry.

Against this backdrop, the adoption of stablecoins and the usage of the underlying blockchains as financial rails are expected to accelerate in 2025.

Fintech companies — from new upstarts to incumbents and from consumer-facing to B2B businesses — will increasingly integrate with crypto rails to offer faster, cheaper, and more efficient financial services to their customers.

The applications for stablecoins will continue to grow beyond savings and payments to spending use cases. We expect merchant acquirers and card networks to increasingly enable crypto payments at checkout, allowing users to spend stablecoins just as easily as fiat.

Alex Botte, partner, Hack VC

In 2025, we expect venture capital investment in crypto and blockchain to rise back toward previous highs.

Currently, VC investment still lags significantly behind the peaks seen in the first quarter of 2022, where roughly $12 billion was invested across approximately 1,350 deals, according to Galaxy data.

In the third quarter, those figures were $2.4 billion, a drop of80%, and spread across 478 deals (a 65% decrease).

This gap is at least partly due to the continued absence of traditional VCs and institutional investors, especially in the US.

Private markets, particularly early-stage VC investing, tend to lag behind liquid markets, which have seen major tokens like Bitcoin and Solana reach all-time highs recently.

However, as this market cycle matures and investor confidence rebounds, we expect VC capital to increase, potentially even surpassing previous highs.

Improved regulatory clarity in the US with the incoming pro-crypto Trump administration and Congress will likely attract more institutional players than in previous cycles, and VC investment will accelerate.

Robert Le, crypto analyst, Pitchbook

We predict 2025 will see a resurgence in VC investment into crypto, with total funding to surpass $18 billion for the year, along with multiple $5 billion quarters.

This will mark a significant recovery from the $9.9 billion yearly average and $2.5 billion quarterly average during the 2023 to 2024 period.

This will likely be fuelled by macroeconomic stabilisation, institutional adoption, and the return of generalist VCs.

Heavyweights like BlackRock and Goldman Sachs will likely increase their participation in crypto, which in return will enhance investor confidence and regulatory trust, paving the way for broader institutional participation.

Their involvement could drive mainstream adoption and attract asset managers, hedge funds, and sovereign wealth funds into crypto.

Generalist VCs, returning after a period of retreat, will shift the focus toward startups demonstrating traditional metrics like recurring revenue and measurable traction.

This approach may catalyse a broader convergence of crypto with AI, fintech, and traditional finance, emphasising sustainable growth over speculative investments.

Improved global liquidity and declining interest rates will further boost VC funding, with rising token prices aligning public and venture markets.

However, this optimistic scenario hinges on regulatory stability, particularly in the US, and consistent macroeconomic conditions.”

Karl-Martin Ahrend, founding partner, Areta

For 2025, we are expecting a surge in M&A and IPOs, which will highlight a transformative shift in the industry.

Traditional financial institutions are increasingly entering the space, seeking exposure to crypto projects with strong product-market fit. These firms often lack the expertise to build solutions internally, driving a wave of partnerships and acquisitions.

At the same time, political tailwinds, including the potential for a crypto-friendly SEC under new leadership, are creating optimism for clearer regulations. This regulatory clarity, paired with advancements in security, has bolstered investor confidence, paving the way for more public offerings and strategic deals.

Looking ahead, this intersection of institutional interest and favourable regulatory shifts will likely continue fuelling M&A and IPO activity, shaping the industry’s future.

Update December 30: The headline has been updated to reflect that while all experts have knowledge about VC investments, not all of them are investors.

The insights above have been edited for clarity.

Eric Johansson and Liam Kelly cover crypto funding trends for DL News. Got a tip? Email them at eric@dlnews.com and liam@dlnews.com.

“As I predicted, 2024 turned out to be a very good year,” Durov said in his Telegram channel.

The founder, who has been detained in France pending a criminal inquiry, didn’t specify just how good.

But he did say Telegram’s revenue surpassed $1 billion after its premium accounts tripled to 12 million subscribers.

Durov also noted that Telegram is closing the year with $500 million in cash reserves, not including crypto assets.

And crypto has been a big part of its bottom line.

The app has sold hundreds of millions of dollars in cryptocurrency, including Toncoin, a token closely associated with Telegram, according to two unnamed sources who spoke with The New York Times.

In 2023, Telegram had almost $400 million in crypto on its balance sheet, according to the Financial Times.

And in the first half of the year, the value of the digital assets it owned soared to $1.3 billion, reported the FT.

Durov’s detention

The end of 2024 is bittersweet for Telegram and for Durov, who is reportedly worth more than $15 billion.

The Russia-born billionaire is mired in one of tech’s highest profile criminal inquiries.

In August, French authorities detained Durov, who is a citizen in France and the United Arab Emirates, under six preliminary charges.

Officials allege that he and his company have refused to cooperate with authorities on the distribution of child sexual abuse material and the sale of narcotics through Telegram, among other illegal activities.

“Using laws from the pre-smartphone era to charge a CEO with crimes committed by third parties on the platform he manages is a misguided approach,” Durov wrote on Telegram after he was arrested.

Durov was released on a €5 million bail under the condition he check in with authorities twice a week and not leave France.

In December, he recently appeared in court in the country.

Moderation efforts

Meanwhile, the messaging app, which promises users encrypted messaging and privacy, has ramped up its moderation efforts.

It’s changed its terms of service and increased the number of moderators it employs to more than 750 contractors, according to The Times.

And Toncoin, the Telegram-linked cryptocurrency, has rebounded 22% since September, according to CoinGecko data.

Ben Weiss is DL News’ Dubai-based correspondent. Reach out to him at bweiss@dlnews.com.

Now, Howard Lutnick, CEO of Cantor Fitzgerald and newly appointed Commerce Secretary under Donald Trump’s administration, is betting on its future.

The firm plans to launch a Bitcoin-backed lending programme with Tether’s support, starting at $2 billion and potentially growing into tens of billions according to Bloomberg.

Lutnick’s firm also recently acquired a 5% stake in Tether, valued at $600 million, making it a major partner in the world’s largest stablecoin, USDT.

Cantor reportedly manages most of Tether’s $132 billion in assets, earning it tens of millions annually in fees.

Tether’s leadership sees Lutnick as a key ally.

“Giancarlo Devasini [Tether CFO] said privately earlier this year that Lutnick will use his political clout to try to defuse threats facing Tether,” reported The Wall Street Journal.

A spokesperson denied these claims, stating, “Tether’s relationship with Cantor is entirely professional, based on managing reserves.”

Lutnick, who plans to step down from his Cantor roles upon Senate confirmation, said, “I intend to divest my interests in these companies to comply with US government ethics rules.”

Tether controversy

Despite Tether’s dominance as the largest stablecoin, controversies persist. Questions about whether Tether fully backs USDT with reserves have plagued the company for years.

Quarterly attestations claim over $84 billion in US Treasury bills and other assets.

However, authorities have linked USDT to illicit activities, including organised crime and money laundering.

A UN report in January identified USDT as the “preferred choice” for Asian crime syndicates, allegedly facilitating $17 billion in illegal trades.

In October, The Wall Street Journal reported a criminal investigation into Tether for alleged violations of anti-money laundering rules. Tether’s CEO Paolo Ardoino called the claims “regurgitated noise.”

Lutnick, however, has defended the company’s reserves, stating, “We found every penny.”

Crypto market movers

• Bitcoin is down 0.6% over the past 24 hours to $98,023.
• Ethereum is up 0.9% over the past 24 hours to $3,402.

What we’re reading

• Coinbase App Gets Left Behind as Memecoin Craze Drives Traders On-Chain — CoinDesk
• Crypto’s lobbying machine isn’t done yet. Here’s why it’s raised another $78m — DL News
• Trump’s Plans for a ‘Crypto Czar’ and a Crypto Advisory Council: Here’s What We Know — Unchained
• When will Ethereum hit record highs like Bitcoin and Solana? Experts say $10,000 within sight — DL News

Kyle Baird is DL News’ Weekend Editor. Got a tip? Email at kbaird@dlnews.com.

About a fifth of Ethereum projects closed down over the last two years, according to a report from Lattice, a venture capital fund. That’s better than the 26% of Solana projects that foundered.

The researchers looked at blockchains with at least 15 crypto startups that raised funds during 2022, the most recent period with available data.

BNB Chain-based projects were the least likely to remain active, with one-third of teams ceasing operations.

Speculative capital

Lattice said an influx of speculative capital during the bull market drove projects to over-extend themselves.

Many of those projects blamed the brutal market decline caused by events like the Terra ecosystem collapse and the FTX bankruptcy for forcing them to shut down, according to public statements from their founders in their closure notices.

The report also noted that nearly 80% of seed-stage Ethereum-based startups had shipped products since 2022, while just over 60% of Solana projects could say the same.

While Solana’s price has climbed 32% this year, the report stands as a grim reminder of crypto’s brutal two years that preceded 2024′s rally.

Market crash dampened VC interest in follow-ups

Investors poured over $5 billion into nearly 1,200 crypto startups in 2022, a 150% increase from 2021, according to Lattice.

That’s lower than DefiLlama’s figure of $19.5 billion which comes from a broader accounting of crypto VC deals whereas Lattice only considered blockchains where at least 15 projects secured funding.

Nearly 30%, or $1.4 billion, went to seeding Ethereum-based startups while early-stage Solana projects attracted 7%, or $350 million.

The buzz around things like NFTs, the metaverse, and web3 gaming buoyed the influx of capital. Understandably, many crypto entrepreneurs decided to capitalise on those trends, which may have been a mistake.

“Chasing narratives can get you rekt,” Lattice Capital Co-Founder Regan Bozman tweeted. “$700 million went into gaming seed rounds but Gaming and Metaverse had some of the highest fail rates and likelihood to be active without anything shipped.”

Gravy train

When the excitement waned from scandals and industry failures, the gravy train ceased to run. That made it harder for startups to raise more money. Only 12% of the 2022 cohort have raised follow-up funds.

While 72% of the teams that bagged funding have launched a product since 2022, 18% have either failed to ship or have shut down.

Ethereum-based startups from the period were the most successful in shipping products as 80% of them did so, compared to only 61% of their Solana-based counterparts.

Things are improving

As previously reported by DL News, VCs are predicted to splash $12 billion to back crypto projects in 2024 with some of that funding likely to go towards seeding new startups.

Lattice identified an uptick in investments in privacy-enhancing technology, artificial intelligence, and DePIN which stands for decentralised physical infrastructure networks.

Earlier this year, global asset manager Franklin Templeton tipped Solana as a leading network for DePIN.

Osato Avan-Nomayo is our Nigeria-based DeFi correspondent. He covers DeFi and tech. To share tips or information about stories, please contact him at osato@dlnews.com.

VC funds are on course this year to surpass the $2.6 billion raised in 2023, according to a report from PitchBook.

The data suggests that VC’s appetite for crypto investments is slowly returning after a grinding bear market in 2022 and early 2023, and a spate of regulatory challenges in the US as well as the European Union.

“We anticipate another fundraising peak in 2026, aligning with the next expected major cycle in the crypto market,” Robert Le, senior analyst of emerging technology at PitchBook, wrote in the report, released Thursday.

“The crypto industry has historically followed a four-year cycle,” Le said, “often tied to Bitcoin’s halving events, which have had significant market impacts.”

The halving refers to an quadrennial event where the Bitcoin crypto miners get for verifying the blockchain is dropped by half. The last halving occurred in April.

In 2023, the bottom fell out of the crypto VC fundraising space in the wake of the FTX scandal and the numerous bankruptcies in the market. VC fundraising nosedived almost 90%, to $2.6 billion, and raises fell to 49 from 163.

With just 24 rounds raising $2.2 billion this year, there’s still a long way to go to even approach the giddy heights of a couple of years ago. But stability counts.

“The rebound can be attributed to the overall recovery of the crypto market, in which the total crypto market cap reached 93% of the previous cycle’s watermark in March 2024,” Le said.

Mainstream investors

VCs may also be bolstered by Wall Street’s embrace of Bitcoin as a legitimate asset class worthy of mainstream investors.

BlackRock, Franklin Templeton, Van Eck and other giants issued exchange-traded funds for the top cryptocurrency in January and rapidly attracted billions of dollars.

“While the data only includes closed funds, numerous large funds are actively being raised, which will contribute to larger fundraising totals in the next 12 to 18 months,” Le wrote.

Eric Johansson is DL News’ News Editor. Got a tip? Email at eric@dlnews.com.

Approximately two-thirds of the company’s revenue comes from its deals with law enforcement, tax agencies, and other government entities, Michael Gronager, co-founder and CEO, told DL News at the crypto conference Token2049.

However, he expects that to change.

“You will see the private sector outperforming the public sector,” he said, in reference to Chainalysis’ revenue split.

Stablecoin rules

His prediction comes as the European Union and other countries pass regulations that require crypto firms to register their activities with the government.

In the EU, the Markets in Crypto-Assets Regulation, or MiCA, took effect in July 2023. Part of the legislation’s remit includes the regulation of stablecoins.

The new law stipulates that crypto firms need to secure payments licences and adhere to reserve requirements.

If more countries pass new crypto regulation like MiCA and then traditional financial institutions decide to deal in stablecoins, Chainalysis will “suddenly have 10,000 customers worldwide with huge pockets,” Gronager said.

Why? Those institutions will all need to adhere to the new rules and use blockchain tracing tools, like those from Gronager’s firm, to ensure they’re compliant, he said.

Saturation point

And Chainalysis may need new, untapped customers from the private sector to continue to grow.

The analytics firm already works with 250 government agencies in 50 countries. There’s an upper limit on how many more contracts Chainalysis can land in the public sector, Gronager said.

“Is there 1,000? Probably not.” Gronager said, in reference to how many government agencies have yet to sign with Chainalysis. “Is there 300? Probably yes.”

Still, he did say that the scale of the contracts the analytics firm has with governments can grow.

In other words, Chainalysis can persuade existing public sector customers to use more products and tools that would net the firm more revenue.

The increases came along with a rise in the broader crypto market.

Multicoin Capital, a venture-capital fund with close ties to Solana, saw its assets’ value jump almost 180%, to $3.81 billion in 2023 from about $1.36 billion in 2022, according to filings with the Securities and Exchange Commission.

Polychain Capital, which was founded by former Coinbase employee Olaf Carlson-Wee, saw its fund’s value almost double, to $5.04 billion in 2023 from $2.61 billion the year before.

And Blockchain Capital, which announced in September 2023 that it had raised another $580 million for more crypto investments, said the value of its assets under management increased to $2.36 billion from almost $1.74 billion.

Others that saw smaller increases include Paradigm, which saw its fund’s value surpass $10 billion; Haun Ventures, which valued its assets at more than $1.5 billion; and Andreessen Horowitz, whose massive fund, which counts crypto among its investments, was worth $56 billion at the end of 2023.

Representatives for five of the venture-capital firms mentioned above didn’t immediately respond to a request for comment from DL News. Multicoin declined to comment.

Crypto investments creep back

The rebound in the fortunes of the biggest crypto VCs mirrors the revival of the broader crypto market.

In 2022, top crypto investors said their assets under management were substantially lower than they were in 2021, according to Newcomer.

Paradigm marked down its portfolio 34%, and Multicoin said its assets fell 85% in value.

And the total value in crypto raises dropped to a monthly low of a little less than $300 million in July 2023 from more than $7 billion in October 2021, according to data from DefiLlama.

More than a year and a half later, crypto is back in business.

Bitcoin reached an all-time high of more than $71,000 in March, per CoinGecko, and crypto VCs invested about $1 billion in the industry in February.

And VC enthusiasm has kept pace. May recorded $777 million in crypto funding, an increase over the $622 million in funding recorded one year earlier, per DefiLlama data.

However, despite renewed optimism for the industry, some crypto VCs still haven’t recovered to the heights of the last bull market.

In 2021, Paradigm said its assets under management were $13.2 billion, and in 2022, it said it employed 73 staff members. Now it has only 59 employees.

Correction: A previous version of this story incorrectly stated May recorded about $200 million in VC funding. It has been amended to $777 million.

“Ten,15, 20 years from now, everyone will be using AI,” he told DL News, so saying you’re investing in an AI firm “will be as stupid as saying ‘I’m investing in a company that has a website.’”

As portfolio manager at crypto hedge fund Pantera Capital, Jiang says he is actively looking for projects using AI to boost blockchain businesses — or vice-versa.

The crypto investment firm — which lists Coinbase, Circle and Bitstamp among its portfolio companies— is raising a new $1 billion fund to inject fresh capital into the industry.

An earlier fund injected about 15% to 20% of its capital into AI-adjacent blockchain projects, Jiang said, expecting the new fund to invest even more.

That would suggest Pantera Capital — which is expected to have the fund’s first close in 2025 — will invest over $200 million into AI-adjacent crypto projects over the rest of this decade.

While not actively committing himself to that figure, “the math would suggest that’s reasonable,” Jiang said.

AI opportunity

Jiang’s comments highlight the growing buzz around the intersection of AI and blockchain technologies.

Bolstered by estimates that the combined power of crypto and AI may add $20 trillion to the global economy by 2030, investors have injected over $98.8 million into the sector since the beginning of 2024.

AI tokens achieved a total market value of $26 billion, and Bitcoin miners are supplementing their income by providing processing power for Silicon Valley giants to train their AI tools.

Others are also seizing on the trend.

Hedge fund manager Brevan Howard’s digital assets boss Gautam Sharma has said it’s exploring opportunities in the space.

Jiang said AI and blockchain have a shared heritage, with many of its developers naturally floating between the two sectors.

As an example, he pointed to Sam Altman, who “started two independent companies that he thinks are actually synergistic and need to coexist: OpenAI and Worldcoin.”

What does Pantera look for?

Pantera Capital has hardly kept its interest in the intersection of AI and crypto a secret — the firm has inked blog posts, hosted panels, and generally gushed about it for months.

When asked what the firm is looking for, Jiang was more coy.

He did reveal though that he wants to avoid “opportunistic entrepreneurs” who “go to college saying they want to be an entrepreneur with zero idea of what they want to build, and they just do whatever is getting the most funding.”

While recognising that the AI industry is still in its early stages, Jiang said he sees opportunities in how blockchain can provide AI agents with the rails to better perform their tasks, whatever they may be.

AI agents are programmes that independently interact and collect data to better perform pre-determined tasks.

He also sees opportunities in how blockchain can help AI development verify data.

One company doing just that is Nexus Laboratories, which is one of the reasons why Pantera Capital co-led the startup’s recent $25 million Series A funding round.

A third opportunity is using the rails of blockchain to train AI. Bittensor is one such project, Jiang said.

Pantera Capital has invested in Bittensor, but did not disclose how much it has invested in the project.

Bittensor runs a blockchain similarly to other cryptocurrencies. Unlike Bitcoin, Bittensor’s miners validate new blocks by completing tasks, many of which are AI-related.

But those examples are just scratching the surface, Jiang said. “There will be a tonne of AI and crypto opportunities.”

Eric Johansson is DL News’ News Editor. Got a tip? Email at eric@dlnews.com.

The neobank, which is valued at $26 billion, serves 40 million customers.

Revolut, which as an early crypto adopter among fintechs, is seeking to partner with more crypto wallets such as MetaMask, a company spokesperson told DL News.

Revolut isn’t the only digital payments platform hiring for crypto roles. PayPal, the global payments processor, advertises 22 crypto-related roles. And Stripe and Robinhood, the discount trading platform, each have four open positions each.

The companies did not return requests for comment.

Their hiring efforts are testament to the industry’s renewed optimism amid regulatory approval of both Bitcoin and spot Ethereum exchange-traded funds this year

Not only are the biggest crypto exchanges hiring over 1,200 new roles, but industry watchers expect Bitcoin to break its March record, and venture capital investments to skyrocket.

“We are in a bull market like we’ve never experienced before — there’s going to be so much work for us from a recruiting perspective,” Sam Wellalage, founder at crypto recruitment firm WorkInCrypto.Global, recently told DL News.

Fintech competition

Revolut faces competition from other firms muscling into the sector.

Johann Kerbrat, the general manager of Robinhood’s crypto arm, has told DL News it wants to be “the on-ramp to the crypto world.”

Robinhood’s crypto push will catapult its market cap to about $26 billion in 2025, up from $18 billion today, analysts at research firm Bernstein estimate.

Elsewhere, Stripe will resume crypto payments this summer, and PayPal has recently added its own stablecoin to its mix of crypto services.

Revolut’s crypto push

Revolut has made crypto a key part of its business model since it first launched crypto trading across Europe in 2017.

During the 2021 bull run, crypto contributed between 30% and 35% to Revolut’s £39.8 million profit, CEO Nikolay Storonsky told Bloomberg TV in 2022.

Those tailwinds ceased in 2022 when Revolut went back in the red, revealing a £25 million loss in 2022.

In March, the neobank unveiled Revolut Ramp, which allows users to buy and deposit crypto directly into MetaMask wallets.

Eric Johansson is DL News’ News Editor. Got a tip? Email at eric@dlnews.com.

MicroStrategy, co-founded and led by Michael Saylor, is already the biggest institutional holder of Bitcoin and is not seeking to give up its position. It holds more than $13 billion worth of Bitcoin, depending on market fluctuations.

The publicly-traded company says it considers itself the world’s first Bitcoin development company, committed to the continued growth of the Bitcoin network through its activities in the financial markets, advocacy and technology innovation.

MicroStrategy may now raise as much as $786 million if the initial purchasers exercise in full their options to buy additional notes.

The notes will mature on June 15, 2032, unless earlier repurchased, redeemed or converted in accordance with their terms. They will bear interest at a rate of 2.25% per annum, payable semi-annually.

They are being offered and sold to persons reasonably believed to be qualified institutional buyers.

MicroStrategy saw a 146% jump in its stock value in the first quarter, driven by a rally in Bitcoin, DL News reported.

Venture capitalists are the lifeblood of crypto, and some of the top crypto VCs, including Paradigm, say their assets increased in 2023 from the previous year, DL News has reported.

The rebound in the fortunes of some VCs mirrors the revival of the broader crypto market, as Paradigm saw its funds’ value surpass $10 billion last year.

The company’s co-founder Matt Huang said in a statement: “It’s more important than ever to accelerate a positive future for crypto, not just as investors but as builders.”

Over the past few years, Paradigm has helped launch a number of open-source projects with the goal of pushing the crypto frontier forward.

“We’re excited to dedicate significant effort to such projects over the coming years,” Huang added.

Still, despite renewed optimism for the industry, many crypto VCs haven’t yet recovered to the heights of the last bull market.

In 2021, Paradigm said it had $13.2 billion in assets under management, and in 2022 it said it employed 73 staff members. Now, it has only 59 employees.

While that’s still some ways to the $1.78 billion injected into the industry in 2022, investors say the sector is rebounding.

“There will be a tonne of AI and crypto opportunities,” said Cosmo Jiang, portfolio manager at hedge fund Pantera Capital, which will invest north of $200 million into the intersection of AI and blockchain until 2030.

The buzz around AI and crypto is palpable and for good reason: Researchers estimate that the combo will add $20 trillion to the global economy by 2030.

AI-linked stocks like chipmaker Nvidia are on a tear, enabling the total value of AI tokens to catapult to $27.6 billion.

At the same time, market watchers expect raises and acquisitions in the overall crypto industryto grow this year.

Investments are a great litmus test for where investors expect the market to go next.

Here are the biggest AI-crypto winners.

Exohood Labs

Raised: $112 million

Description: Developer of an AI-based blockchain

Investors: Livsquare Capital

Auradine

Raised: $80 million

Description: Developer of a web infrastructure platform intended to offer a broad range of infrastructure across hardware, software, and AI.

Investors: Celesta Capital, Marathon Digital Holdings, Maverick Capital, Mayfield Fund, MVP Ventures, StepStone Group, and Top Tier Capital Partners.

Zama

Raised: $73 million

Description: Developer of an open-source framework designed to help companies protect their users’ privacy.

Investors: Anatoly Yakovenko, Blockchange Ventures, Gavin Wood, Juan Batiz-Benet, Metaplanet Holdings, Multicoin Capital, Protocol Labs, Stake Capital, and VSquared Ventures.

TradeAlgo

Raised: $41.77 million

Description: Operator of a market research platform designed to help investors with trading education, technology, and tools.

Investors: N/A.

Passes

Raised: $40 million

Description: Developer of a content creation platform designed to enhance the creator experience and increase their revenue.

Investors: Abstract Ventures, Alexandra Botez, BOND Capital (San Francisco), CapitalX, Crossbeam Venture Partners, Emma Grede, Jens Grede, Michael Ovitz, and Ramtin Naimi.

Eric Johansson is DL News’ News Editor. Got a tip? Email at eric@dlnews.com.

The stock-sharing app is strengthening its crypto team, has rolled out crypto trading services in the European Union, and is acquiring exchange Bitstamp for $200 million.

Such efforts will drive Robinhood’s operating income to roughly $900 million in 2024, and its market cap to between $19 billion and $23 billion in 2025, Bernstein analysts wrote in a Wednesday note.

The analysts estimated that Robinhood is on track to see $3.4 billion in revenue in 2025. The firm has seen tailwinds including demographic trends, Bernstein said.

Millennials generated about 1% of US household wealth in 2010. That figure has soared to about 10% as Robinhood ramps up its offerings of crypto, equity, derivatives and savings based products to younger demographics.

About 60% of Robinhood’s assets are from customers under the age of 43, Bernstein said.

“We want to be kind of the on-ramp to the crypto world,” Johann Kerbrat, the general manager of Robinhood’s crypto arm, told DL News in December.

The fintech’s digital asset efforts are paying off. Cryptocurrencies’ share of Robinhood’s transaction-based revenue jumped to $81 million in the second quarter, up 161% compared with the same period last year.

Robinhood is not alone in wanting to become a crypto champion. Revout, Stripe, and PayPal are making similar moves.

The bullish sentiment comes as Robinhood earlier this month agreed to buy back a more than $600 million stake once owned by collapsed FTX founder Sam Bankman-Fried. The pact draws a line under a long-disputed tussle over the Robinhood shares.

The fintech has also found itself in the Securities and Exchange Commission’s crosshairs because of its crypto services.

In May, Robinhood revealed that it had received a so-called Wells Notice, labelling the letter alerting it to potential SEC legal action as “disappointing.”

Eric Johansson is DL News’ News Editor. Got a tip? Email at eric@dlnews.com.

State Street, a bank holding $4.1 trillion in assets, is the latest to jump into the fray, last month inking a partnership with crypto custody and tokenisation platform Taurus.

“There are two main reasons, client demand and regulatory clarity,” Lamine Brahimi, co-founder and managing partner of Taurus, told DL News.

The way Brahimi tells it, fund management giant BlackRock’s entry into tokenisation earlier this year is influencing customers of other banks to demand similar services.

Tokenisation isn’t cheap. Brahimi said some of the banks his firm works with spent tens of millions of dollars over several years building the necessary infrastructure.

“The main advantage of using a player like us is cheaper total cost of ownership and an order of magnitude faster time to market,” Brahimi said.

State Street is not alone. Deutsche Bank, Santander, and Caceis, one of the largest asset custodians in Europe, are also working with Taurus to tokenise assets.

Tokenisation has been around for a while. As far back as 2017, firms experimented putting various financial instruments on blockchains.

Recent regulatory clarity regarding crypto assets in Europe and elsewhere has given many asset managers the green light to start rolling out in force.

Tokenised private credit has grown 39% to $8.9 billion this year, per data from rwa.xyz.

The value of all tokenised assets, including US Treasury debt and commodities like gold, sits as over $11.9 billion.

According to Brahimi, the trend will accelerate over the next few financial quarters.

Why tokenise?

Brahimi said tokenisation confers two advantages on banks: speed and capital efficiency.

He offered an example of two banks organising a common short-term loan to highlight the advantages.

“If I want to do it in the traditional way, the transfer of the money-market funds takes two days to go from one custodian to the other,” he said.

“If you tokenise it, it’s literally 25 seconds.”

Tokenisation is an opportunity for banks to access a new distribution method via crypto.

“They’ve been encouraged by the rapid growth of stablecoins,” Ian De Bode, chief strategy officer at real world asset platform Ondo, told DL News. “There’s growing evidence that the same demand exists for other traditional assets.”

In a recent interview with DL News, Roger Bayston, Franklin Templeton’s head of digital assets, predicted that demand for tokenised money funds will match the $169 billion stablecoin market in coming years.

The US lags

The key to the growth of tokenisation is gaining US regulatory clearance.

Banks operating exclusively in the US must confine themselves to using permissioned blockchains such as Hyperledger’s Besu, rather than more popular public options like Ethereum.

Brahimi blames that on a Securities and Exchange Commission 2022 ruling known as SAB-121. It created accounting obligations for companies to safeguard crypto assets for platform users that cannot be met on public blockchains.

This is a roadblock for many US firms eying tokenisation, as it limits them from accessing the most liquid blockchain markets.

Taurus, as well as many other tokenisation platforms advertise themselves as chain agnostic, meaning they don’t push clients toward any one blockchain.

Still, Brahimi said, many have a preference.

“When they have the choice, financial institutions are rolling out production on public blockchains,” he said. “When they don’t have the choice, they do it on a permissioned one.”

Tim Craig is DL News’ Edinburgh-based DeFi Correspondent. Reach out with tips at tim@dlnews.com.

While the previous bull market saw VCs back application layer startups such as Coinbase, the research firm said this year will see backers return to basics.

“This cycle we haven’t seen any applications getting these large investments,” Robert Le, Pitchbook’s crypto analyst, told DL News.

Instead, VCs are eying infrastructure projects — so-called layer 1s — that support all manner of crypto applications and networks.

Top deal

For instance, the top deal of the first quarter of 2024 went to Together AI, a developer of an open-sourced decentralised cloud platform. In March, it scooped up $106 million in an early-stage round led by Salesforce Ventures.

In the first quarter, VC investments in crypto surged 40%, to $2.4 billion, compared with the prior period.

The focus on infrastructure is one of the reasons Le estimates the industry will raise just 2.4% more this year than the $9.4 billion raised in 2023.

He compared it with infrastructure projects like Amazon Web Services raising proportionally less money than application-level startups such as Uber and Facebook.

That being said, Le said he expects application projects to attract more money as this cycle heats up.

Eric Johansson is DL News’ News Editor. Got a tip? Email at eric@dlnews.com.

Coolpad said it plans to acquire 2,700 Bitcoin mining computer servers, without specifying the manufacturer.

It said it will buy the rigs from Hong Kong-based JingYun Intelligent Technology to deploy in North America.

The investment will increase Coolpad’s current computing power from 873,000 TH/s to about 1,504,800 TH/s, it said. This story was first reported by Crypto.News.

Coolpad is principally engaged in the production and sale of mobile phones and accessories, the provision of wireless application services, and leases of properties.

Still, since the second half of 2023, the company said it has has actively pursued opportunities in the “Web 3.0 digital currency business.”

Coolpad initiated its move towards crypto in May with a $28 million investment plan to purchase shares in crypto asset companies listed on Nasdaq.

The company said it was looking at acquiring shares in companies like, but not limited to, CleanSpark, ARK 21Shares Bitcoin ETF, Bitwise Bitcoin ETF, Grayscale Bitcoin Trust, and Hashdex Bitcoin Futures ETF.

That’s according to a new book, “Digital Currency or Digital Control? Decoding CBDC and the Future of Money,” by Nicholas Anthony, a policy analyst at the Cato Institute’s Center for Monetary and Financial Alternatives.

“There should be no misunderstanding: Efforts in the United States and abroad are little more than a bid to solidify government control over money and payments,” he wrote.

Exploring CBDCs

Interest in CBDCs, which stands for central bank digital currency, among monetary policymakers is increasing.

A total of 134 countries and currency unions are exploring CBDCs, almost four times the number in May 2020, according to the Atlantic Council.

That includes 19 of the G20 countries and the five founding members of BRICS, the club comprising Brazil, Russia, India, China and South Africa.

China, which started evaluating CBDCs in 2013, has rolled out pilot programs in 25 cities.

Still, the projects have struggled to get off the ground. In China, merchants in pilot cities remain puzzled by what exactly the e-CNY — the digital yuan — is, and most people have only heard of it in passing.

The East Caribbean Central Bank’s prototype, DCash, suffered an outage from January to March.

And in the US, developing CBDCs has stalled amid growing concerns about how they might affect people’s rights.

Anthony says more needs to be done to ensure CBDCs don’t take hold in the financial system.

‘The problems that we have with the current cross-border system are based on policy choices.’

Nicholas Anthony, author

“I am very worried and I think this is a real risk throughout the world,” Anthony told DL News.

He’s calling for people to start speaking up against CBDC projects.

“Because if that can happen now, we can very much change the outcome, both in terms of what final form that they take and whether people use them or not.”

What’s the point of a CBDC?

Anthony’s main argument is that there are few tangible benefits to countries implementing a CBDC.

“I’ve seen folks try to make the argument for financial and the like, but once you peel back to the next layer of that conversation and go into the details, it just doesn’t really hold up,” he said.

In the US, for example, 72% of the country’s 5.9 million unbanked households are simply uninterested in having a bank account, according to a Federal Deposit Insurance Corporation survey.

One reason is that they don’t meet the minimum balance requirements to open a bank account, while others are that they don’t trust banks or that they think they will enjoy more privacy without one.

There’s nothing, Anthony argues, inherent within a CBDC that would change this.

Indeed, the big problem in making cross-border payments more efficient doesn’t stem from technology, he said.

“A lot of the problems that we have with the current cross-border system are based on policy choices,” the author said. “The barriers that are currently up between borders are largely choices that federal governments have made.”

“There are other ways to solve this that don’t involve reinventing money, like reassessing the Bank Secrecy Act regime and relevant regimes abroad,” he added.

Programmable features

What really concerns Anthony is how CBDCs could control or restrict consumers’ financial decisions.

Last October, Lu Lei, deputy administrator of the State Administration of Foreign Exchange in China, advocated the use of “programmable features” in its CBDC.

And Thailand mulled a CBDC pilot that would have given citizens several thousand baht to spend, but restrict spending to within a certain radius of their homes.

Anthony offers the scenario of governments being able to cut down on excess drinking by limiting how many drinks a person can buy.

‘If they get rid of all those features for governments, and there’s no features for citizens, then what are we doing?’

Nicholas Anthony, author

“These types of paternalistic policies may sound appealing for some at first glance, but can quickly fall apart or lead to unintended consequences. For example, how would it account for someone buying a round of drinks for a group of friends?”

More seriously, he added, it could also prevent people from shopping at legal but politically controversial businesses. Or even introduce negative interest rates to push people towards spending instead of saving.

“It opens up this new suite of tools that they didn’t otherwise have. However, those tools come at our expense,” he said.

Out of fashion

He said that discussing programmable features has fallen out of fashion with Western governments over the last few years.

“What we’ve seen is from 2016 to around 2021, those ideas were floated around quite openly. Now that we’ve had this slow rise of concerns, they’ve backtracked a little bit,” he said.

This has brought the argument for CBDCs into another “awkward space.”

“If they get rid of all those features that were going to benefit governments, and there’s no features that are going to benefit citizens, then what are we doing?” he said.

“It quite literally makes you scratch your head.”

Callan Quinn is DL News’ Hong Kong correspondent. Contact her at callan@dlnews.com.

CleanSpark said in a news release that it will assume all outstanding debt and other obligations of GRIID and provide it with a $5 million dollar working capital loan and a pay-down bridge loan of $50.9 million at the signing.

“This acquisition would give us a clear and steady path over the next three years to accomplish in Tennessee what we proudly achieved in Georgia over the past three years,” said CleanSpark CEO Zach Bradford. “That achievement was to build out over 400 megawatts of infrastructure backed by valuable, long-term power contracts.”

The two companies also entered into an exclusive hosting agreement for all available power, of which 20 MW was to be immediately allocated to CleanSpark.

GRIID operates Bitcoin mining data centres in various cities and towns throughout Tennessee that are serviced by the Tennessee Valley Authority, the largest and one of the most important US public power companies.

“I am incredibly excited for the opportunity for GRIID to join the CleanSpark team,” said Trey Kelly, GRIID’s CEO. “Together, we will achieve rapid growth in the Tennessee Valley.”

Power play

CleanSpark said it anticipates surpassing 100 MW in Tennessee by the end of this year and increasing that to 200 MW in 2025 before exceeding 400 MW in 2026.

The deal is expected to close in the third quarter; it was approved by both boards and is subject to GRIID shareholder approval.

CleanSpark said earlier that its net income for the quarter ended March 31 as Bitcoin rallied was $126.7 million, compared with a loss of $18.5 million in the year-earlier period.

This strategic partnership will increase Bitdeer’s total available capacity to 2.5 GWs worldwide and strengthen its infrastructure development pipeline for Bitcoin mining, high-performance computing, and AI, the company said in a news release.

Hannibal Industrial Park previously served as an aluminium processing facility, so the site benefits from existing power infrastructure, utility switchyards and transmission capable of supporting hyperscale loads.

“We are excited about the prospects this expansion brings to Bitdeer and our stakeholders,” said Linghui Kong, chief business officer at Bitdeer. “The strategic location of the Hannibal Industrial Park, combined with its ready-to-use infrastructure, significantly expands our existing power capacity and supports our growth ambitions in Bitcoin mining and HPC and AI.”

An initial 266 MW is expected to be available in the third quarter of next year, with the remaining 304 MW under review to be formally incorporated into the regional transmission planning process.

Earlier this month, DL News reported that stablecoin issuer Tether Holdings had acquired a $100 million stake in Bitdeer, with an option to buy another $50 million in shares within 12 months after closing.

Paolo Ardoino, CEO of Tether, said: “We regard Bitdeer as one of the strongest vertically integrated operators in the Bitcoin mining industry, differentiated by its cutting-edge technologies and a robust R&D organisation.”

Bitdeer’s founder and CEO is Chinese crypto billionaire Jihan Wu, who in 2013 co-founded Bitmain, which has become the world’s biggest computer chip company for Bitcoin mining.

Headquartered in Singapore, Bitdeer has deployed data centres in the US, Norway, and Bhutan.

Valor Capital Group and Jump Trading Group supported the round, while JPMorgan, Standard Chartered, DBS, and Temasek provided continued support as founding shareholders.

“Partior is breaking down silos and rewriting the rules for cross-border clearing and settlement,” said company CEO Humphrey Valenbreder. “We see a very bright future for blockchain-based frictionless, cross-border transactions. Having some of the world’s best banks and investors back our vision validates this even further.”

Traditional cross-border payments face multiple challenges, including delays, high costs, lack of transparency on timings, multiple intermediaries, variable processing speeds, and differing compliance standards across correspondent banks.

Partior’s global unified ledger enables financial market participants, including banks and payment service providers, to join its network and access real-time, cross-border, multi-currency clearing and settlements, according to the blog post.

This funding will enable the advancement of new capabilities including Intraday FX swaps, cross-currency repos, programmable enterprise liquidity management, and just-in-time multi-bank payments, the company said.

JPMorgan, Standard Chartered, and DBS are currently using Partior to facilitate payments for their customers.

Companies including Siemens and iFAST Financial have used Partior’s platform through Standard Chartered for better access and control of their working capital, 24x7 availability, and faster, more seamless payment flows.

This was a 2.5% increase in invested capital, but a 12.5% decline in the number of deals when compared with the previous quarter, the study noted.

The bigger deal value and lower number indicate deal sizes increased during the quarter, it said.

With positive investor sentiment returning to crypto and barring any major market downturns, PitchBook said it expects the volume and pace of investments to continue increasing throughout the year.

An earlier PitchBook study cited by DL News said crypto startups are on track to outstrip the $8.2 billion raised in 2023, as investors are expected to pour more than $12 billion into industry projects this year.

Infrastructure startups continued to lead the way in the second quarter, with the biggest rounds raised by parallelisation layer 1 platform Monad ($225 million Series A), DeFi-specific layer 1 platform Berachain ($100 million Series B), and Bitcoin restaking platform Babylon ($70 million early-stage round).

Two other mega-rounds went to Farcaster, which raised a $150 million Series A round, and to blockchain-based gaming platform Zentry, which raised a $140 million early-stage round.

Compared with full-year 2023, valuations were up for the seed stage and the early stage, yet were down for the late stage.

This indicates that investment rounds have become highly competitive at the earlier stages but less so at the late stage, PitchBook said.

Venture capital firm Draper Associates, Fulgur Ventures, Axiom Capital and angel investor Stephen Cole also participated in the round, Ark Labs said in a news release.

Ark Labs launched in May with a plan to bring seamless and scalable payments to Bitcoin by advancing and maintaining an open implementation of the layer 2 Ark protocol.

“Ark’s architecture allows for seamless Bitcoin payments, in a way that stays true to its core principles of decentralisation and self-custody” said Draper, founder and managing partner of Draper Associates, who funded Tesla, Skype, and Hotmail, among others, at the seed stage.

While the Lightning Network has made progress in improving Bitcoin’s scalability, it still presents challenges for merchants and non-technical users, according to the news release.

Ark addresses this by offloading the complexities of transacting with Bitcoin to trustless servers called Ark Service Providers, enabling users to start sending and receiving payments immediately with just a wallet.

This eliminates the need for deep technical understanding or custodial solutions, making Bitcoin more accessible.

The company sees Ark becoming a go-to solution for consumer-facing payments and remittances, while Lightning continues to play a leading role in enterprise applications, the release said.

The offer is seamlessly integrated into its existing channels, including ZKB eBanking and ZKB Mobile Banking, so clients can now trade crypto around the clock, the bank said in a news release.

“”Our newly launched offer in the field of cryptocurrencies offers a high level of security and allows the integration of further currencies and applications,” said Alexandra Scriba, head of institutional clients & multinationals at ZKB.

She added that customers do not need their own wallets and do not have to worry about the storage of their own private keys, as ZKB handles both functions.

Third-party banks are also able to take advantage of ZKB’s service, as Thurgauer Kantonalbank is already using it, according to the release.

ZKB is partnering with Crypto Finance AG, a subsidiary of the Deutsche Börse Group, to handle crypto trading.

The bank has been working on blockchain technology for some time. In 2021, ZKB was involved in the issuance of the world’s first digital bond on the SIX Digital Exchange, and in 2023, as joint lead manager, it handled the issue of digital bonds with digital central bank money as part of a Swiss National Bank pilot project.

ZKB is not the only Swiss bank developing digital technologies and moving into crypto.

In July, Sygnum, a Swiss global crypto banking group with about $4.5 billion in client assets, reported that it reached profitability following a strong first half, with key metrics showing year-to-date growth, DL News reported.

The company said that compared with the year-earlier period, it saw a twofold increase in crypto spot trading volumes, a 500% expansion of crypto derivatives trading, and a 360% surge in lending volumes. Specific first-half profit figures were not disclosed.

At least, that’s what one crypto founder believes.

“We essentially need to build financial infrastructure for the most techy players in finance,” Paul Frambot, the CEO and founder of lending protocol Morpho, told DL News in an interview in Singapore on Monday.

“It’s very clear to me that this is the next step.”

‘Artificial casino’

Originally pitched as a far more efficient and transparent financial system, DeFi has become an “artificial casino” where speculation drives yields, Frambot said in the runup to Token 2049.

Morpho, which has raised $77 million from venture capital firms such as a16z and Ribbit Capital, launched at the peak of the hype cycle in 2021.

In a bid to best the most popular DeFi lending projects, Aave and Compound, Morpho launched Optimiser, a software layer that maximises yields.

Since the summer of 2021, however, DeFi’s total TVL, or invested deposits, has slid 56%, according to DefiLlama data. Fewer investors in DeFi means there are fewer developers and builders, and projects must compete for dwindling resources.

‘Aave versus Maker, Maker versus Ethena — everybody’s competing?’

Paul Frambot, Morpho

“It is getting more competitive, that’s clear,” Frambot said.

“Aave versus Maker, Maker versus Ethena — everybody’s competing.”

Leading fintechs Revolut, Robinhood, and eToro have each embraced crypto as a core piece of their offerings in the banking or brokering market.

Frambot is hopeful they and others can burnish DeFi’s attraction for mainstream users.

“The question is, How do we get from this artificial casino, bootstrapping phase to the broader message?” he said.

Fintechs plug in

Over the past decade, digital banks like London-based Revolut have established a beachhead in the once impregnable domain of traditional banks.

Making a run in payment processing, though, is proving to be harder.

Fintechs must use the same outdated “rails” as banks, remittance firms, asset managers, and other financial players.

“They plug into the traditional financial infrastructure, which has limitations. It’s not efficient, it’s not transparent, it’s not resilient,” Frambot said.

An opportunity

He said this is an opportunity for decentralised finance. And fintechs get it.

They are already building apps to plug into web3, he said.

Robinhood has partnered with Arbitrum on a self-custody wallet.

He expects more fintechs to seek more DeFi partnerships in the months to come.

“They’re aggregating the order flow of finance, and now they can become the owners themselves of the financial infrastructure,” he said.

“They’re essentially breaking free of TradFi.”

Ben Weiss and Jo Wright are correspondents for DL News. Ben is reporting from TOKEN2049 this week.

Validators nodes, like the ones Deutsche Telekom runs, help confirm transactions sent through blockchains. Those who run them must put up some crypto as collateral to do so, or have others delegate assets to them. In return, those who put up their assets automatically receive rewards from the network.

In this sense, running validators helps keep blockchains secure.

But why is Deutsche Telekom, a technology giant associated with a bygone era, diving into the role of a Polygon validator?

Deutsche Telekom has a goal to become an infrastructure provider in web3, Dirk Röder, head of the Blockchain Solutions Center at Deutsche Telekom, told DL News.

“Supporting the Polygon network as a validator is a big milestone in this objective,” he said.

Supporting Ethereum by validating for Polygon?

But Deutsche Telekom has an even more specific interest in web3.

The company has “a focus on the Ethereum ecosystem and its scalability solutions,” and Deutsche Telekom’s foray into Polygon is in line with that, Röder said.

The company describes Polygon as “the leading Ethereum Layer-2 scaling platform” which implies that Polygon relies on Ethereum for its blockchain security like Arbitrum and Optimism. It also says the company “relies on Polygon to strengthen the Ethereum ecosystem.”

“Polygon validators sign checkpoints on the Ethereum blockchain, security is derived directly from Ethereum Layer 1 consensus, which is secured by more than 20 million ETH staked,” Röder told DL News.

NOW READ: LayerZero demands anonymous devs reveal identities to work on new bug bounty effort

But Deutsche Telekom’s specific interest in Polygon may not accurately represent the nature of the blockchain — a concern that once led Polygon to change its marketing.

Polygon initially promoted its technology as a layer 2 scaling solution for Ethereum. However, in response to criticism from many in crypto about potential misrepresentation, the company decided to discontinue the use of such terminology.

Polygon is a sidechain, which operates like an independent blockchain with no security relation with Ethereum. More specifically, some have called Polygon a “commit-chain” based on the fact that it “commits” its transaction history to Ethereum but does not rely on it to ensure transaction records are accurate.

Definitely an error, will correct.

Polygon PoS is not an average sidechain as well.

We generally use the term scaling solutions, but sometimes employees or journalists use L2 because it's very common. Btw sidechains used to be called L2s until very recently (even by the EF). 🙂

— Mihailo Bjelic (@MihailoBjelic) June 27, 2022

Röder did not immediately reply to a question about Polygon not relying on Ethereum for its security.

Polygon’s assets are secured by a multi-signature wallet controlled by a group of eight individuals or entities. Signature from five of them is enough to make drastic changes to the network which secures almost $1 billion worth of assets.

“Decentralisation often comes at the expense of speed,” Röder told DL News.

“As a result, many blockchain projects initially begin in a more centralised form and gradually transition to a decentralised model,” he said. “Polygon follows a similar approach.”

But perhaps the fact that Polygon is a sidechain, which has nothing to do with Ethereum, doesn’t matter for Deutsche Telekom that much. After all, the company’s not an Ethereum maximalist — it supports six different blockchains.

In addition to Polygon, Deutsche Telekom runs validators for major and minor blockchains including Ethereum, Q, Celo, Flow, and Energy Web. It also contributes to Chainlink’s oracle node network which helps DeFi apps receive data from outside sources.

NOW READ: Montenegro leaders turn on crypto after Vitalik’s Zuzalu fest. The reason: Do Kwon

Running a validator node itself is not an overly complex task. Many are hosted in giant data centres run by companies like Amazon Web Services for a small fee.

However, many of the blockchains Deutsche Telekom supports don’t let everyone run a validator. You need a special invite for that.

In the case of Polygon, one of Deutsche Telekom’s recent additions, the network comprises only 100 hand-picked validators like Deutsche Telekom. In comparison, Ethereum, where anyone can spin up a validator at home or host one at a data centre, has over 700,000 validators.

‘Infrastructure, not asset management’

What Europe’s largest telecommunications company’s strategy from running validators is remains unclear.

Röder emphasised that blockchain technology presents a “valid business case.”

“The expression ‘valid business case’ refers to our business model. Deutsche Telekom runs web3 infrastructure and receives percentages of the rewards,” Röder told DL News.

But according to another Deutsche Telekom representative, the company does not stake any of its own crypto assets, and instead relies on others to do so and takes a cut of their rewards.

“Our business is infrastructure, not asset management,” the other representative said.

“We are getting paid to provide rock solid infrastructure to asset holders. Those people use our infrastructure to delegate their tokens and we receive a commission for our service from those rewards.”

NOW READ: Everything is about to change at MakerDAO: Rune Christensen on his Endgame plan

This week, it announced it was doing the same for the lesser-known Energy Web blockchain.

But some think that Deutsche Telekom buddying up with blockchains could be more of a marketing strategy than anything else.

“It’s interesting because they’ve been fairly active in crypto for years,” Santiago Santos, a crypto angel investor, told DL News.

Santos speculated on what might be behind the move. “Presumably, some angle to be relevant with their young user base,” he said.

It’s probably cool to run a validator.

US venture capital firm Andreessen Horowitz announced Sunday that it will expand its $7.6 billion crypto operations to the UK, amid last week’s wave of enforcement in its home country.

The firm’s new London office will have a crypto focus, with aims to bolster the UK’s fintech community through its Crypto Startup School program.

The move has been in the works for around six months.

Statement from UK prime minister Rishi Sunak on a16z’s expansion to the UK: https://t.co/wlPKTureQt pic.twitter.com/BICI8HJu8c

— Frank Chaparro (@fintechfrank) June 11, 2023

UK Prime Minister Rishi Sunak — who has expressed positive ambitions for crypto in the UK — said he is “thrilled” at Andreessen Horowitz’s arrival in the country.

The comments come amid moves by UK banks to stifle crypto usage this year.

NOW READ: Bitcoin’s ‘digital gold’ narrative sees renaissance — even as pro traders balk

Winklevoss twins warn that ‘war on crypto’ will hurt Democrats in 2024

Gemini co-founders Cameron and Tyler Winklevoss predict that the “war on crypto” waged by Democrats will cost them the 2024 election.

Cameron Winklevoss said efforts from Senator Elizabeth Warren and Securities Exchange Commission Chair Gary Gensler will “alienate an entire generation of would-be Democrats,” referring to younger demographics that he claims are largely pro-crypto.

A 10 year-long registration process with no end in sight! https://t.co/CfdNbsNoFe

— Cameron Winklevoss (@cameron) June 11, 2023

Tyler Winklevoss followed up with a comparison to the controversial overturn of abortion case Roe v. Wade, which the billionaire stated “cost Republicans the midterms.”

The SEC issued a lawsuit against Gemini in January, on the basis that its Earn product constituted an unregistered offer and sale of securities.

It’s an allegation the agency has levied against other major firms including last week’s actions against Binance and Coinbase.

NOW READ: How the SEC’s showdown with Coinbase will change the crypto market for everyone

Crypto firms Solana, Polygon shoot back at SEC on security allegations

Major crypto firms Solana and Polygon shot back against the US Securities Exchange Commission over the weekend, after the agency made allegations that the firms’ respective SOL and MATIC tokens are securities.

Polygon Labs, which operates both the Polygon layer two network on Ethereum as well as its own native Polygon blockchain network, stated in a Saturday tweet that the firm neither originated in nor specifically targeted the US market.

The Solana Foundation said it “disagrees with the characterisation of SOL as a security” and urged for legal clarity from US regulators.

The SEC named some 12 cryptocurrencies in its June 5 lawsuit against leading global exchange Binance, among them SOL, MATIC, and Cardano’s ADA token.

CFTC wins victory against Ooki DAO, sets possible precedent for DeFi regulation

The US Commodity Futures Trading Commission won a precedent-setting victory against decentralised autonomous organisation Ooki DAO on Thursday, when a federal judge ruled in favour of the agency on grounds Ooki DAO offered the sale of unregistered commodities.

US Judge William H. Orrick ordered Ooki DAO to pay $643,542 in fines, and to cease operations and shutter its website.

The move is a major enforcement milestone against a DeFi organisation, against a backdrop of litigation targeted towards largely centralised entities such as Binance and Coinbase.

It remains to be seen how the Judge Orrick’s orders will be enforced, as Ooki DAO did not partake in or acknowledge the lawsuit — though it did restrict US internet activity to the site.

NOW READ: Circle nabs former Trump CFTC regulator to lead legal team

Stablecoin issuer TrueUSD halts TUSD minting on Prime Trust platform ahead of acquisition

Stablecoin issuer TrueUSD paused minting of its TUSD stablecoin on crypto infrastructure provider Prime Trust’s platform until further notice on Friday.

The pause precedes digital asset trust company BitGo Holdings’ acquisition of Prime’s parent company, Prime Core Technologies.

TUSD will still be available to mint through other platforms, according to TrueUSD.

Judge orders FTX customer list sealed from the public

A judge ruled Friday to keep bankrupt exchange FTX’s customer list private ahead of a potential sale or revival of the company.

NOW READ: VC trio sues Curve founder for ‘deception’ and handling of trade secrets

The ruling was sought by FTX’s lawyers, who contended the list would be a key selling point to future investors, and would also protect creditors from incurring additional losses due to trade secret leaks.

US bankruptcy authorities as well as news organisations had argued that the list should be made publicly available, to facilitate bankruptcy proceedings and better inform the public of details of the case.

More web3 news from around the web…

Dems press Treasury, IRS to crackdown on crypto wash trading — Blockworks

Minecraft still hasn’t officially banned NFTs—but it’s coming — Decrypt

Millions in Polygon’s MATIC tokens were sent to Binance and Coinbase ahead of 30% slide, data shows — CoinDesk

The company says it will help users recover their seed phrases, which function like passwords, but some critics say the update may open up security vulnerabilities.

Hardware wallets — also called cold wallets — are physical devices that store private keys to crypto offline. They’re typically considered more secure than alternatives that store keys on computers or mobile devices with internet access, also known as hot wallets. Cold wallets including Ledger are designed to empower users with complete authority over their digital assets.

NOW READ: Recovering scammed assets should be easier with blockchain data but it’s not

Ledger broke “the number-one security rule for hardware wallets: never ever expose the private key in some way — encrypted, unencrypted, or in any other form” Pascal Caversaccio, an independent security researcher, told DL News.

There is now “a communication channel between the device and the outside,” which presents a security vulnerability, he said, adding that his assessment is based on public information, “which is very short on details.”

Exciting update, Ledger has a new product, Ledger Recover, that’s launching soon: https://t.co/nT1VHnnSYz

🧵Here’s what Ledger Recover is and what it isn’t, explained by @P3b7_ & in the thread below. pic.twitter.com/RW1w07H6pK

— Ledger (@Ledger) May 16, 2023

The Recover feature would let the device share an encrypted and compressed version of a user’s private key with three companies, Ledger, Coincover, and EscrowTech.

Mudit Gupta, chief information security officer at Polygon Labs behind the Polygon blockchain, told DL News his main concern is that “the encrypted shards of the key are shared with three centralised entities” since “only two of them need to collude or be compromised to reconstruct the key.”

“This is a big risk,” Gupta said. He added he has no “concerns about Ledger’s current offering or the features.”

‘No backdoor, no security vulnerability’

“Lots of inaccuracies,” a spokesperson for Ledger told DL News, referring to the mounting criticism. “There is no backdoor at all, there is no security vulnerability.”

“If you want more peace of mind, or find recovery phrase management a barrier, you now have a highly secure service, tested by our Donjon team which exposed breaches in TrustWallet and many other wallets, both software and hardware,” the Ledger spokesperson said.

“They have validated it, we have tested it, it’s completely secure,” they added.

Ledger maintains that it’s a matter of opt-in. If a user doesn’t like the new feature, then they don’t need to enable it.

“For those that don’t want to use Recover, their experience doesn’t change — they’re as secure as they have been over the last nine years with six million devices sold and none hacked,” the Ledger spokesperson said.

And for those who want to use Recover, Ledger said the feature needs users to undergo an approval process using the secure display of their Ledger device.

“And it requires the Ledger’s secure element to do all encryption, fragmentation and decryption on the device,” Ledger said. “There’s also a full identity verification process including live-ness detection.”

NOW READ: How hackers turn stolen crypto into cash

“Again, the backups can only be created by your Ledger if you approve it from your Ledger. There’s no software way around it,” Ledger added.

Gupta said that going through identity verification is not fool-proof, since “identity theft is rampant and relatively insecure.”

“There are thousands of sim jacking incidents every year due to identity theft,” Gupta said.

Wider concerns

Ledger said it’s “ultimately it’s about user choice — this is the ethos of self custody.”

“You can continue using your Ledger as you always have, rest assured that your private keys are safe on the secure element which has never been hacked,” Ledger said.

Ledger, the company, suffered a data breach in 2020, which leaked the personal information — phone numbers and physical addresses — of its 300,000 customers. It has also previously come under fire for promoting the use of Ledger wallets as an accessory.

In May 2022, rapper Gunna sported a 20-Carat diamond chain at the Met Gala with a diamond Ledger pendant.

Keep your keys close, wherever you are with our Ledger Nano X OnChain bundle!

Make sure to scoop up a Ledger Nano X + exclusive chain with free shipping - get yours now at: https://t.co/mie8mvvG8X pic.twitter.com/ht8ljmkjrW

— Ledger (@Ledger) April 19, 2023

Caversaccio said that another, wider concern is that the ability to send “encrypted pieces of private keys out of the device, which was previously claimed could never happen” may have already been a built-in feature for Ledger devices.

“There is only [one] way for Ledger to prove that they haven’t enabled this backdoor previously: by open-sourcing the firmware,” Caversaccio said.

Ledger did not immediately respond to a question about the possibility of a built-in feature or possible plans to open-source its code.

Crypto exchange Bitfinex has invested an undisclosed amount of funds in Chilean crypto bank Orionx as South America’s crypto scene is heating up.

“Bitfinex wanted to grow its presence in Latin America to markets that were less developed for crypto investing and where we expect considerable growth,” a Bitfinex spokesperson told DL News, saying both companies plan to use Chile as a springboard to launch further expansion into other countries in South America.

The Bitfinex representative told DL News that both companies are eyeing Peru, Colombia, and Mexico.

Taipei-headquartered Bitfinex’s investment into the crypto bank highlights a flurry of activity in the region, with rising inflation in many countries having triggered growing crypto adoption in South America.

Crypto exchange Coinbase recently expanded into Brazil at the same time as neobanks NuBank and Revolut are eyeing crypto services in the region.

Crypto transactions in South America amounted to $562 billion between July 2021 and June 2022, a 40% growth from the figures recorded in the previous reporting period, according to a 2022 report from blockchain forensics firm Chainalysis.

This growth has also seen at least 60% of adults in South American countries expecting crypto to become a reliable payment means in the next decade, according to an April survey by business intelligence firm Morning Consult.

While Bitfinex didn’t disclose the size of the investment, a spokesperson from the exchange said the cash injection would go towards investing “in education about investing and crypto, working with local universities in Chile.”

Regulatory clarity

Orionx bills itself as a crypto bank these days but it was established as an exchange in 2017.

“As a crypto bank we’re aiming to emulate most of the traditional financial products through crypto and blockchain, in an efficient and transparent way,” an Orionx spokesperson told DL News.

Back in 2018, the exchange was at the centre of a highly-publicised legal battle with Chilean banks that went all the way to the country’s Supreme Court.

NOW READ: DeFi users pile into Ethereum zero-knowledge chains in hope of airdrop riches

The Supreme Court ruled in late 2018 that banks could legally close the accounts of Orionx and other crypto exchanges. However, Orionx got a reprieve from the Court of Defense of Free Competition — Chile’s antitrust body — in a ruling delivered in early 2019.

The regulatory situation for crypto has improved in Chile since then with the country’s Financial Markets Commission ruling that cryptocurrencies are not to be considered as securities.

The Chilean senate also approved a fintech bill in late 2022 which is expected to be passed into law next year.

“The regulation in Chile will be in place in February of 2024 since the fintech bill was passed and we’re waiting for the rules from the regulator who has a deadline on that date,” the Orionx spokesperson said.

Do you have a tip about crypto adoption in South America or any other region? Reach out to us at editorial@dlnews.com

DWF Labs quietly launched an investment arm amid criticism over its unorthodox funding strategy.

The new investment arm, dubbed DWF Ventures, was launched in April without much fanfare, save for a post on self-publication platform Medium and some tweets.

DWF Ventures will focus on “traditional venture financing deals,” DWF Labs Partner Stefano Virgilli told DL News.

“The mandate is to do fundamentals-driven investment only with either token or equity rounds,” he said.

‘Fixed percentage of profits’

DWF Labs declined to divulge details about how much DWF Ventures has to spend, only saying that “it is a fixed percentage of DWF Labs’ profits,” which “we don’t want to disclose.”

NOW READ: Kraken’s UK boss talks IPO, layoffs, and why the exchange is ‘pumped’ about Britain

DWF Ventures operates under DWF Labs DMCC, a Dubai entity announced in March, Virgilli said. DWF Labs has a presence in Singapore, Switzerland, the United Arab Emirates, and the British Virgin Islands.

The development comes after DWF Labs’ investment in the crypto space outpaced investment giant Andreessen Horowitz and matched those recorded by Coinbase’s venture arm Coinbase Ventures at the start of the year.

NOW READ: Zhong’s heist of 50,000 Bitcoin gives way to new ‘industrial’ era in crypto crime

DWF Labs backed 13 projects between January and April, according to DefiLlama data, making it a leader among the hundreds of investors who poured close to $2.8 billion into crypto projects across 284 venture capital deals, community fund raises, token sales, and public equity offerings.

However, reports from The Block and CoinDesk in April suggest the company’s cash injections bear little resemblance with traditional venture capital transactions.

‘It is a bit frustrating from our perspective that somebody starts questioning everything that we do’

The reports noted that the firm called itself a global web3 investment firm and market maker, but it acted more like an over-the-counter trading desk. It bought millions of dollars’ worth of projects’ tokens, drip-feeding capital into the projects over the span of several months, according to those reports.

Virgilli said DWF Labs’ strategy to buy tokens over time was a way to ensure that the deal was fair to both the projects and the market maker. Instead of agreeing on a price for a token at the start, the parties would agree that DWF Labs could, for instance, buy $100,000 worth of tokens for the daily price on each day for 100 days, which would add up to $10 million being invested at the end.

While it’s hardly unheard of for market makers to invest in projects — both Jump Crypto and Wintermute have launched similar initiatives — they usually separate those two parts of the business. The criticism expressed in the reports suggested that DWF Labs had blurred the line between its core business and its investments.

The wrong idea

Virgilli rejected the criticism and saw nothing wrong with its investment strategy.

NOW READ: Harmony execs mismanaged funds and bullied workers, ex-staff claim

“It is a bit frustrating from our perspective that somebody starts questioning everything that we do,” Virgilli said. “They come up with absolute speculation on [the] source of funds and all the rest because they don’t like that we use the word investment.”

Virgilli partly blamed the projects it invested in for the controversies, saying that they announced the deals without checking in with DWF Labs first, which had given the industry and the media the wrong idea.

“They want to jump on the media and announce to the rest of the world that we are working with them,” he said.

When stories have been picked up by the media, the backing has often been portrayed as straight-forward investments. Instead of calling them investments, DWF Labs referred to the deals as “long-term financial support” and “strategic partnerships.”

NOW READ: Bitstamp CEO on 30% staff cut, the crypto meltdown, and why ‘we’re the good guys’

DWF Labs has imposed strict guidelines on how the deals are communicated, including going over announcements with its compliance team to ensure partners use “the correct terminology,” Virgilli said.

The reports also highlighted its relationship with Swiss affiliate Digital Wave Finance, which it described as “one of the world’s largest high-frequency cryptocurrency trading entities,” but one that has little online presence.

Virgilli said that the affiliate’s lack of a major online presence is due to it not needing to woo clients as it being “a trading entity using its own proprietary funds, not raising funds through third parties.”

DWF Labs is led by managing partner Andrei Grachev, who previously worked at Huobi Russia.

Do you have a tip about DWF Labs, investments or another story? Reach out to me at eric@dlnews.com.

Update: This story has been updated to include a correction in the caption of the picture to say that DWF Labs was founded in 2022. Its affiliate DWF was founded in 2018.

On March 27, Vivek Patel woke up $15,000 dollars richer, and at first he didn’t know why.

Finblox, a crypto lender similar to the defunct Celsius, owed him the five-figure sum, Patel said. He had deposited money to Finblox last year to take advantage of the high returns it offered on various crypto assets such as Bitcoin, Ether, and Circle’s USDC stablecoin.

Then last June, Finblox told customers that it needed to redirect portions of their deposits into “reserve funds” and limit withdrawals. The reason: Finxblox had lost millions to the now-bankrupt trading firm Three Arrows Capital.

No explanation

Patel and many other customers didn’t buy the explanation. Now Finblox’s decision in 2023 to swap their money for homegrown tokens called FBX only made them madder.

Some, like Patel, complained on social media. And then voila! One day $15,000 materialised in his account with no explanation.

But Patel suspected Finblox was buying his acquiescence so it could minimise protests and stay in business after Three Arrows Capital failed in July 2022 owing creditors $3.5 billion.

NOW READ: Rookie DeFi traders bear the brunt of bot attacks: ‘Even small trades are at risk’

“Finblox collapsed when Three Arrows Capital went down but continues to run like nothing happened while refusing to pay millions of dollars of debt,” Patel told DL News.

Patel isn’t alone. More than 60 other Finblox customers who lost money or had their debt converted to FBX tokens have joined forces and documented Finblox’s activity online over the past year.

They’ve accused the company of fraud, executing an illegal token offering, moving jurisdictions to dodge regulators, and running a Ponzi scheme by attempting to raise new funds through a token sale to pay back previous depositors.

Their protests are similar to the outcry that has befallen Waves, the blockchain network that lost $530 million for investors after a series of suspicious transactions.

Exposure to Three Arrows

Finblox CEO Peter Hoang denies his customers’ allegations. “None of the actions taken were intended to misguide the affected users,” he told DL News in an email.

While he declined to disclose how much money Finblox lost in Three Arrows Capital, he said the company has been taking steps to strengthen its business and serve its customers.

“We have been very respectful of everyone affected and always try to come up with the solutions in their best interest,” Hoang said. “As a public facing platform, inadvertently we’ll have a small percentage of unhappy or disgruntled users.”

‘Finblox has eaten up my life savings. They’re refusing to return my funds that were deposited on their platform for less than a month.’

Finblox customer

That’s not how a number of Finblox customers see it. DL News spoke to more than a dozen of them who allege the firm took away around 50% of their deposits.

“Finblox has eaten up my life savings,” said one customer who wished to remain anonymous. “They’re refusing to return my funds that were deposited on their platform for less than a month.”

NOW READ: London loses crypto ‘mojo and momentum’ as Revolut hints at Paris move

These customers told DL News their debt was converted to FBX despite them directing Finblox not to make the conversion. Meanwhile, the firm is accepting new deposits and is trying to raise funds through a token sale.

Patel was one of the lucky few who recovered their cash. He thought his money was gone, or in the best case scenario that he might get some back after a long legal fight.

Getting it all back without warning was “random and shocking,” Patel said. Days after receiving his funds and cashing out, Finblox abruptly closed his account without warning.

‘FUD spreaders’

Patel and three others are, as far as he knows, the only ones to get back in full the money they deposited to Finblox.

“My guess is that it’s easier for them if we are not users of their platform – they can claim we are FUD spreaders,” Patel told DL News.

Finblox started to take off in March 2022 when it raised $4 million in a seed round with participation from Coinfund, Rebel Fund, and Sequoia Capital India — an arm of the same venture firm that invested $150 million in FTX.

‘We have been very respectful of everyone affected and always try to come up with the solutions in their best interest.’

Peter Hoang

Deposits on Finblox ballooned thanks to its prominent backers and the outsized yields it offered customers. One of the main ways Finblox generated yield was by lending out its depositors’ crypto assets. Finblox would evaluate and lend money to other crypto players with little to no upfront collateral.

Then last June, Finblox informed customers it was reducing the value of the money they had deposited in their accounts, plus limiting withdrawals to just $1,500 a month.

Six months later, Hong Kong’s Securities and Futures Commission placed Finblox on its list of unauthorised collective investment schemes. (Finblox was based in Hong Kong before moving to the British Virgin Islands this year).

NOW READ: ‘Treat restaking like AI’: Ethereum’s emerging trend sparks concerns about network stability

“Investors should exercise extreme caution if they plan to invest in any non-SFC authorised CIS. They may suffer significant or even total losses in such investments,” the agency said.

A message on the Finblox website says the company no longer offers its services to Hong Kong residents.

William Green, another Finblox customer who recovered his deposits, told DL News he also believes complaining about the situation may have publicly pressured Finblox into paying him.

“I was very vocal both on their support chat and their contact emails and on Twitter,” he told DL News. “It seemed those who were the most vocal were paid.”

Buyback programme

Green also said the official Finblox Twitter account blocked him after he complained about not getting his money back. Other Finblox customers DL News spoke to also said Finblox banned them on Twitter and Discord after they asked for their money back.

Hoang told DL News that the reason some customers were paid was because of a “test buyback scheme.”

“We did a test buy-back for some users who opted in the future buyback programme, we might do more buybacks in the future and it is at our discretion as a company to do that. It was not against our Terms of Use,” he said.

Hoang also said he “only blocked a few users who were using the expletives and publicly threatening the team.”

Switched its stance

Finblox’s policy of swapping debt for FBX tokens has left customers confused and feeling pretty raw.

In September, Finblox told depositors it would convert the money it owed them into FBX if they agreed to fill out a form. In February, Finblox switched its stance and required the same users to opt out of the conversion by filling in a different form.

As a result, customers who believed they had already opted out of the conversion suddenly realised Finblox was going to convert their debt into FBX.

But Finblox didn’t budge. Even before it distributed FBX to customers, the company used legal loopholes in its terms of service to justify converting their debt regardless of their wishes.

‘I didn’t consent to the USDC - FBX conversion but they did it anyway.’

Dawid Maeser

“Absent the clear indication that you wish to opt-out from converting the reserved funds to FBX, submitted through the form, your reserved funds balance will be converted ex gratia into FBX tokens, in accordance with the agreement we have with you,” stated an email sent to one customer and posted in the Finblox Recovery Efforts Telegram chat.

Other Finblox customers DL News spoke to said the same thing had happened to them.

According to the Finblox website, holding FBX gives customers free withdrawals, reduced swap fees, and access to Finblox’s AI application, called AI-FinGPT. Many customers didn’t want to trade their crypto deposit debt for Finblox’s token.

No consent

Dawid Maeser, a customer who is currently involved in legal proceedings against Finblox, told DL News he lost $87,000 he deposited to the platform, which Finblox converted into FBX tokens.

“I didn’t consent to the USDC - FBX conversion but they did it anyway,” he said. In February, he and three other Finblox customers sued the company in Hong Kong.

Hoang said that the majority of customers didn’t have a problem with the conversion.

“Most of the users were happy with the solution and only a handful were not — as evidenced by a low number of complaints,” he told DL News. “We are happy to put you in touch with the users who were very supportive, but also suppressed and blocked by the same users you are probably speaking to.”

Six-month lockup

In February, Finblox launched a buyback programme for customers whose debt had been converted to FBX. Instead of waiting for their FBX to unlock and selling it on the open market, customers could instead sell it back to Finblox.

But many customers wondered where Finblox would get the money to buy back the FBX tokens it had given them.

At the same time, Finblox sold FBX through an ICO — or initial coin offering — with a six-month lockup, meaning those who purchased FBX through the ICO could not sell it for six months.

Ponzi scheme allegations

“Finblox said that they are allocating 30% of the net proceeds from the public token launch to the buyback,” J W, a Finblox customer who signed up for the buyback scheme, told DL News.

Many customers have pointed out that selling FBX to new investors through an ICO and using the funds to buy back tokens resembles a Ponzi scheme.

“Money will be coming from new users who will now indirectly be bearing debt without any knowledge of it,” Patel told DL News. “I can play along with Finblox in its Ponzi and make my money back when they launch the FBX token but it’s not right,” he said.

70% drop

Hoang told DL News that comparing Finblox’s buyback programme as a Ponzi scheme was “incorrect.” He said funds from the FBX token sale would be used to “expand the Finblox ecosystem,” but did not deny that some of the funds were being used to buy FBX from customers.

When FBX started trading on May 12, it was worth just over a cent. It has since fallen over 70%, and is 50% below the price Finblox offered it at through its ICO.

Many customers attribute this drop to Finblox selling FBX to recoup funds at the expense of new customers buying FBX through its ICO.

In his inbox was an email from Celsius Network, telling him it had issued a margin call on a $10,000 loan he had taken out with the company. The crypto lender requested about $3,000 from Shanks or the company would liquidate his collateral — meaning it would keep all the Bitcoin he posted to get the loan, and charge him a 3% fee on top for doing so.

Shanks, 61, was eager to meet the margin call, but on that day, Hoboken, New Jersey-based Celsius froze his account and refused to let him use CEL, its native token currency, to pay off the interest he owed.

What he didn’t know was that Celsius was on the verge of collapse - it filed for bankruptcy protection one month later, on July 13. Shanks, a retired Air Force IT worker in Colorado Springs, Colorado, was one of hundreds of thousands whose accounts had been frozen, preventing customers from withdrawing their crypto from the platform.

Conversations with Shanks, as well as emails between him and Celsius employees obtained from US federal bankruptcy court, give a glimpse into the personal hell experienced by 1.7 million Celsius customers whose crypto is in limbo.

The correspondence details the unfolding drama as Celsius demanded money from Shanks to secure his loan, and as Shanks desperately tried to access and transfer the money from his Celsius accounts.

At each step, Celsius refused to resolve the margin call because his accounts were frozen. And yet Celsius repeatedly renewed a demand for the money.

Behind the scenes, a former Celsius executive told DL News that the company was scrambling to stem a bank run. As regulators investigate, the company, along with cofounder and CEO Alex Mashinsky, face lawsuits. Kirkland & Ellis, the law firm advising Celsius, said in a filing that Celsius had a near $1.2 billion hole in its balance sheet. Kirkland & Ellis did not respond to a request for comment.

$100,000 trapped in a frozen account

For Shanks, 61, the margin call was just the beginning. He had about $100,000 in cryptocurrency stashed on Celsius — a quarter of his savings from his days in the military before he retired in 2000. He was suddenly unable to access any of it.

The stress of dealing with Celsius has made Shanks lose weight, he told DL News.

Solving the problem should have been simple: As part of the loan agreement, Shanks had initially posted collateral, $20,000 in Bitcoin, to receive the $10,000 loan. “I needed the money to pay for some medical stuff. I knew I could pay it off in six to 12 months,” he told DL News. “I just saw the loan as leveraging the Bitcoin I had instead of selling it.”

But in May of that year, Bitcoin plummeted. It had been sitting at about $46,000 in late March. As spring turned to summer, the price fell toward $20,000.

That meant the value of his Bitcoin collateral had fallen below $7,000, and the margin between the $20,000 loan and the collateral was now greater than $13,000, or 65%. The margin was supposed to be 50%. If he could just add about $3,000 or more in Bitcoin, the margin call would be resolved and he would not risk losing all the Bitcoin he posted as collateral.

‘How can a margin call be resolved if all accounts are locked?’

But Celsius had frozen his accounts without informing him, court documents allege. That included about $100,000 of his Bitcoin.

“How can I resolve this,” Shanks replied on the day he received the margin call. He wrote again later that day: “How can a margin call be resolved if all accounts are locked. NO transfers are allowed.”

On June 14, at 2.41 p.m., Shanks received what looked like good news. An email from Celsius staffer Nicoletta Koursari said: “The easiest way to balance your loan LTV level and close the margin call is to add additional crypto as collateral directly through your Celsius mobile app.”

She closed her message with, “Best regards and HODL on!”

But Shanks couldn’t do that. He replied: “Celsius is missing the point. I have excess BTC in my account that I could transfer to cover the required amount... Celsius needs to lift this freeze.”

Celsius halts withdrawals

Nine minutes later, Koursari replied, “We are pausing all withdrawals, Swaps, and transfers between accounts. This necessary action has been taken to stabilise liquidity and operations. Our intent is to honour, over time, our withdrawal obligations.”

“Therefore, in order to resolve the margin call by adding collateral to your loan, additional funds are required to be transferred to the Custody account,” she added. “Alternatively, you can close the loan.” DL News was unable to reach Koursari for comment.

Shanks was outraged. Not only was his $100,000 in Bitcoin stuck in a frozen account, but the company now demanded he send them even more to cover the margin call.

‘Your account is not frozen’

“I was betrayed, I was lied to, I felt deceived,” he told DL News. “This mainly was over email because I know if it’s not in writing, you have nothing to back up your statement.”

“They would say, ‘Oh, your account is not frozen, we can help you.’ But whenever I put it in writing, it came back with the typical social-media script.”

Shanks says he hopes to demonstrate to the court that he tried to close out his accounts before the company filed for bankruptcy, and that therefore his assets should not be distributed as part of the bankruptcy estate — creditors generally get pennies on the dollar once a company’s assets are sold and distributed to those who are owed money.

On June 14, the messages from Celsius grew even more confusing. At one moment, a staffer would insist that Shanks could pay off his loan. At another, he was told his accounts were frozen.

Shanks wrote to one of them: “Celsius has frozen all accounts preventing me from transferring the required number of coins to cover the margin call. Unless Celsius unfreeze the account, I CAN NOT meet the requirements of the loan for the margin call.”

The staffer who replied said, “We would love to help out, but I’m afraid your inquiry is not clear to us as your account is not frozen.”

Shanks sent them another email:

“Do you NOT see the issue… I have provided a screenshot to try and explain.”

A lifeline

Another Celsius staffer, identified only as Bojan, appeared to offer Shanks a lifeline.

He told Shanks in an email later on June 14: “We can initiate a transfer of assets from the Earn service [an interest-bearing account] to your Custody Wallet in order to respond to your prior Margin Call. … If you wish to proceed, please confirm by indicating below that you ‘Confirm’ the transfer.”

“Please note that, if you proceed, your account may be temporarily placed on HODL mode while we process these transactions,” Bojan also said. “HODL mode” was the company’s way of disabling an account temporarily.

Shanks approved the transfer 19 minutes later, the emails show.

At this point, Shanks thought he had resolved the margin call. Bojan emailed him to confirm: “Your request for internal transfer has been escalated to our dedicated team, and we will notify you as soon as the action is completed.”

Celsius declines to accept its own tokens

But he also added a technicality: “In addition, recently the CEL token has been paused, and currently, we can’t accept it for the loan interest payments.”

CEL was the native crypto on Celsius that the company had suggested customers use to pay off interest on their loans, according to Shanks’ complaint in US federal bankruptcy court. Shanks sent another email, boiling with frustration: “WHY is cel no longer an option to be able to pay the interest. i have purchased cell for this is [sic] exact purpose”?

At this point, Shanks changed his mind. With the price of Bitcoin continuing to crash, he decided to pay off the loan entirely, not just the margin call.

Celsius staffer Kira Airy offered to help him do it. “Do you need assistance with closing your loan? I’d be more than happy to help,” she wrote.

Shanks replied three minutes later: “Yes, please do help… I need to swap the all cel coins to usdc coins. The [sic] what ever is needed to swap from BTC to usdc coin to pay off the loan.”

But 23 minutes after that, Airy declined to let him pay the loan: “Currently, withdrawals, swaps, and transfers between accounts have been stopped,” she wrote.

On June 16, at 8:45 a.m., she elaborated: “We need to receive the loan principal in one of our approved Stablecoins,” which included USDC and USDT, among others.

Notably, Celsius wouldn’t accept CEL, its native token, in payment.

‘We can’t swap coins on your behalf’

Shanks persisted. At 11:20 a.m. on June 16 he told her: “As I stated, swap cel coins for usdc coins. Swap BTC FOR USDC COIN for the required amount to pay off the loan.”

Airy wasn’t having it: “Hi Fred, We can’t swap coins on your behalf. Best, Kira.”

Shanks became sarcastic: “Then how does Celsius plan to resolve this issue. As celsius created the enigma of preventing account holders from managing their funds to resolve payments and closing of loans.”

Airy kept it professional. “Hi Fred, Our operations continue and we will continue to share information with the community as it becomes available,” she wrote. “Please let us know how you’d wish to proceed with your current loan.”

Four minutes later, Shanks said: “I wish to close the loan with the funds I have available in my account… Why would I send more funds to a company that is hold [sic] over 100k dollars of mine hostage?” Airy did not respond to DL News’ request for comment.

That was the last email between Shanks and Celsius.

Behind the scenes

Behind the scenes, Celsius executives were trying to make customers whole, said Rohit Sabhlok, who at the time was the lead for crypto trading architecture at Celsius.

“The company was not trying to steal people’s money,” Sabhlok told DL News. He has since left Celsius to cofound KYAX.com, which helps crypto companies with audit, tax, and regulatory requirements.

As crypto prices plummeted, “that started a bank run on the institution — and no one withstands a bank run. Once you crush that liquid reserve,” it’s over, he said.

Internally, Celsius executives noticed that some institutional customers were taking out funds. But retail customers — ordinary individual investors — were moving more slowly. Rather than leave the retail customers to bear the full brunt of the withdrawals, a decision was made to stop all withdrawals, Sabhlok said.

“We started working out where our assets were liquid and selling them, to pay customers’ returns. But there’s only so much we can take. We were selling out to pay people back. We then decided, ‘That was it, we can’t really go on.’”

Shanks told DL News: “I felt violated. I felt like they literally stole my money and stole my rights, as if they didn’t have to abide by the laws. The contracts were useless.”

Delio’s move underscores the escalating concerns of a possible contagion in Korea’s crypto industry, reminiscent of last year’s global collapse, primarily fuelled by undisclosed counterparty risks.

In a statement, Delio cited the troubles facing Haru Invest as the principal reason for halting its operations.

“Recently, confusion and complications have arisen among Haru Invest customers,” according to an automated translation of the statement said. “We apologise for causing concern to our valued customers and investors due to the unavoidable temporary suspension of withdrawals.”

“Delio will make every effort to promptly assess the facts and consequences related to this situation while ensuring the protection of our customers’ assets,” the statement said.

NOW READ: Crypto investors cry foul as Finblox converts deposits to tokens to offset 3AC losses

Although Delio has previously denied any financial exposure to Haru, Korean media outlet Block Media quoted Delio CEO Jung Sang-ho as saying today that “there is a transactional relationship with Haru Invest but the amount cannot be disclosed.”

‘The trust has been severely broken, and it will be very difficult for CeFi service providers in Korea to recover.’

Haru Invest ceased operations yesterday amid complications with its brokerage partner, B&S Holdings. Today, Haru levelled accusations against the brokerage for producing fraudulent management reports and deceiving the company and announced its intention to take legal action against the brokerage firm, as conveyed in a notice to investors.

Jun Hyuk Ahn, a Korean blockchain consultant, told DL News that Koreans tend to see Delio “as a safer and guaranteed option” than other CeFi platforms and that “customers did not expect” Delio’s exposure to another CeFi company like Haru.

CeFi, or centralised finance, refers to part of the crypto industry that’s run by centralised entities, like centralised exchanges and crypto lending companies, unlike DeFi, which consists of protocols deployed on the blockchain.

NOW READ:’Best regards and HODL on!’: Celsius customer’s fury as $100,000 in Bitcoin trapped in collapsed crypto lender

The exact extent of Delio’s financial predicament remains unclear. Delio’s website claims the lender holds $1 billion worth of Bitcoin and $8 billion in crypto.

Analysts like Ki Young-ju, CEO of blockchain analytics firm CryptoQuant, have disputed these figures, suggesting that Delio might be factoring in funds held by its parent company Bithumb in its calculations. DL News could not independently verify the figures.

The validity of Delio’s $8 billion claim has also been questioned, as the figure remains unchanged even when the website’s language is switched from Korean to English, leading to speculation that Delio may only hold $6.45 million in crypto assets.

NOW READ: Feds grab win against Ooki DAO but who will pay the $650,000 penalty?

“Regardless of the amount of loss, the trust has been severely broken, and it will be very difficult for CeFi service providers in Korea to recover from these events,” Jun said.

Delio’s issues mirror the undisclosed counterparty risks that prompted last year’s CeFi lending collapse.

The collapse of the Terra ecosystem in May 2022 triggered a contagion, impacting Three Arrows Capital, a crypto hedge fund, and causing it to default on loans taken from CeFi lenders like Voyager Digital.

Other CeFi lenders which deposited customer funds in DeFi protocols for high yields, were also hit hard when the crypto prices sharply fell last year, losing customer deposits in the process.

Delio did not immediately respond to DL News’ request for comment.

This is a developing story and will be updated when more information is available.

Blockchain was punted as a revolutionary technology poised to disrupt every industry from healthcare to Hollywood, but it’s now suffering from a bad PR problem.

The highest-profile crypto exchanges are embroiled in legal battles with regulators, and a range of much-hyped blockchain projects have very publicly failed or faded away. And then there’s the bad press around Bitcoin’s climate impact.

Blockchain can, however, still count on formidable believers like Rebecca Rettig, chief policy officer at Polygon Labs, to cheer it on.

Kicking off her career litigating complex commercial disputes, Rettig switched gears in 2021 to become Aave’s general counsel before jumping over to Polygon at the start of this year. As a litigator-turned-crypto advocate, her job is to distil complex information into a narrative, whether for consumption by a jury, a policymaker or a regulator.

The Value Prop is her latest effort to help other advocates do just that. It is a crowd-sourced database of blockchain projects that tries to make a case for the tech’s positive social impact. It’s her and Polygon’s answer to policymakers’ question of why people need blockchain when other technologies could seemingly do the job.

“There needed to be an answer to that,” Rettig told DL News.

NOW READ: Deutsche Telekom’s foray into crypto raises more questions than it answers

Chain-agnostic tool

The Value Prop is an attempt to provide an easily referenced educational resource for anyone trying to persuade policymakers or even the general public of blockchain’s benefits.

The Value Prop features around 300 projects from 39 use cases — including apps for know-your-customer functions, digitising royalties payments, and cross-border digital currencies — in seven verticals such as healthcare, finance and social impact.

Some of the projects are high-profile and established. These include USDC issuer Circle and the Singapore regulator’s Project Orchid. Others are smaller and more obscure.

NOW READ: Sam Altman-backed Reserve makes $20m Curve Wars power play

But Rettig says the Value Prop intends to keep signing up projects, and said some 100 more projects have put themselves forward since Polygon publicised the database last week. Projects must be vetted by her team before they are listed in the database under certain criteria, like having users and a working website.

Rettig said the database is intended as a public good, so it’s network-agnostic.

“We didn’t build this to highlight applications that were built on top of Polygon,” she said. “It spans from Bitcoin to Ethereum to Polygon, Solana, Base and others.”

As such, it’s a bridge between the two worlds of policy and decentralised projects often run by anonymous individuals.

“[It’s about] what we are explaining to policymakers and society at large, who have questioned why we need blockchain or crypto. But it’s also meant to speak to a lot of the community,” Rettig said.

Failure to launch

Crypto Twitter hailed Rettig’s efforts as a rare instance of celebration for the beleaguered industry. Blockchain advocates sometimes argue that the scandals and lawsuits rocking crypto come down to human foibles and are not a failing of their underlying tech, lamenting that the public still tends to conflate volatile cryptocurrencies with blockchain.

Next time you hear someone say "bLoCkChAiNs HaVe No ReAl UsE cAsEs" show them this database

Start with Fileverse to onboard them with a gasless experience of crypto and without any KYC https://t.co/PVz0vJkRIj

— Fileverse (@fileverse) June 16, 2023

Polygon’s own MATIC token was identified as a security by the Securities and Exchange Commission in a lawsuit filed against Binance. The network has said it does not target US consumers.

In parallel, blockchain projects in financial services — which has long been seen as a kind of testing ground for blockchain’s viability — have so far failed to find really transformative uses for crypto or blockchain.

That’s not for lack of trying. This week alone, Deutsche Bank applied for permission to become a crypto custodian in Germany, heavyweights including Citadel Securities and Fidelity launched a digital assets exchange, and BlackRock applied to launch a spot Bitcoin exchange traded fund.

NOW READ: Goldman and BlackRock embrace tokenisation even as on-chain bonds branded a ‘failure’

But global banks and asset managers have invested in blockchain for a decade, seeing it as a way to bring efficiencies to creaking technology in areas like collateral management. Mostly these have been run as internal innovations pilots and quietly abandoned.

But some publicised projects wound up being humiliating failures. The Australian Securities Exchange took a $170 million hit in November, after the failure of its project to replace its clearing and settlement system with blockchain.

Mainly, these failed projects could have been done with other, cheaper technologies, Virginie O’Shea, CEO and founder of consultancy Firebrand Research, told DL News.

“The vast majority of work has been on private blockchains and these aren’t interoperable,” O’Shea said. “As an industry, we seem to be building the same silos on different technology. The concept of an open, publicly available blockchain that provides full transparency is always going to be challenging in capital markets with many intermediaries with vested interests.”

From the initial focus on settlement efficiency, firms have now shifted to wider tokenisation efforts, trying to prove the viability of digital securities issued on blockchains, she said.

NOW READ: BlackRock’s tokenisation push is just the start — private asset boom may hit $290tn

“We’re still in pilotsville with these. Industry level, we’re seeing the same thing across the board, including central banks testing out the concept of CBDCs,” O’Shea said.

“Nothing thus far has been game-changing.”

Creating transparency

But Rettig is sanguine, pointing to the flood of news about traditional finance’s foray into crypto and blockchain.

“TradFi has voiced scepticism over time for one reason or another, but I don’t think there was actually scepticism internally,” she said. “There’s a lot going on in those institutions, they haven’t slowed down.”

And the use cases go far beyond finance, to digitising land registries in developing nations, or creating transparency into where nonprofits are putting their funding.

A decentralised autonomous organisation founded by United Nations agency UNICEF for greater transparency in social giving, for example, is featured in the database, Rettig said.

“We are highlighting a lot of things that sceptics may have turned up their noses at or thought are unnecessary.”

Have a tip about blockchain use cases? Contact the author at joanna@dlnews.com.

The vast majority of central banks — 93% — are working on some form of central bank digital currency.

Twenty-four could have either a retail or wholesale CBDC by 2030, according to a report published this week by the Bank of International Settlements.

“The BIS survey shows that central banks are more bullish than ever on CBDCs,” Gilbert Verdain, founder and CEO of Quant, a technology partner on the Bank of England’s CBDC project, told DL News.

The BIS comprises 63 of the world’s central banks, including the Federal Reserve, the European Central Bank, and the Bank of Japan.

As such, it helps shape monetary policy for the global economy.

The big news in the report was the dynamic role played by emerging markets driving the expansion of retail CBDCs.

The push for financial inclusion and improving remittance payments is pushing acceptance of this new form of money, the report said.

All the five economies with a live retail CBDC — Nigeria, Jamaica, Eastern Caribbean, and Bahamas — are emerging economies.

The BIS survey found that work on retail CBDCs is more advanced than on the wholesale side.

NOW READ: Swedish CBDC head: The state doesn’t care how people pay for things

Nevertheless, more than half of respondents were working on a pilot project or a concrete experiment for a wholesale CBDC.

But experts worry that privacy concerns about retail CBDCs could slow work.

Hot-button issue

CBDCs have become a hot-button issue in crypto maximalist circles, where they are seen as creeping state surveillance and an existential threat to the industry.

These views have found favour in the US, where a string of Republican draft bills have cited worries that a digital dollar would enable the government to spy on private transactions and choke crypto innovation.

READ MORE: Attacks on CBDCs highlight crypto’s new battleground

Florida governor and 2024 presidential hopeful Ron DeSantis wants to ban CBDCs in the Sunshine State, and Texas Senator Ted Cruz wants to do the same at the federal level.

Some in the financial sector suspect CBDCs are a potential threat to the existing banking system — a distortion that continues despite evidence to the contrary, Verdain said.

The BIS survey found that 87% of central banks engaged in CBDC work consider using private sector intermediaries.

These companies would carry out know your customer, and anti-money laundering procedures and provide wallets and user interfaces.

Also, Verdain added, blockchain technology can protect individual privacy with zero-knowledge proofs and encryption.

“Many countries, such as the UK, are taking very considered approaches to adoption,” he said.

“Pilots involve extensive public and regulatory consultation, with business and institutional involvement, to ensure that CBDCs meet our democratic needs.”

Tainting wholesale

Meanwhile, traditional financial firms hope wholesale CBDCs can bring efficiency and reduced risk to trading and settlements.

The process of completing financial transactions is one that is slow, highly structured, and involves intermediaries utilising ageing technology.

NOW READ: BoE exec hits back at CBDC critics over privacy concerns: ‘In the UK we’re really clear about this’

Plus, there’s a 48-hour delay between when the trade is agreed and when it is settled, which introduces risk into the process.

That delay has practical reasons, but does introduce risk as a lot can happen in two days.

The buyer could default before paying up, for instance.

Or one leg of the trade could settle correctly while the other doesn’t, a problem that arises particularly when two different currencies are involved.

Weekends and holidays can extend the settlement delay, which extends the risk.

Many central banks are trying to extend the hours in which they do settlements for that reason.

Wholesale CBDCs could introduce “atomic settlement” to TradFi — meaning both sides of a trade could be settled instantly and simultaneously.

That would mitigate a lot of settlement risk caused by that 48-hour window, and allow central banks to settle trades almost round the clock, said Alex Knight, head of Europe, Middle East and Africa for fintech company Baton Systems.

Even so, adoption of wholesale CBDCs isn’t a given. The privacy concerns on retail CBDCs will be a factor.

“There will be some headwinds to the extent that people are concerned about retail — that will impact wholesale too,” Knight told DL News.

Have a tip about crypto regulation or CBDCs? Contact me at joanna@dlnews.com.

You use the central bank digital currency to pay your bus fare to work and to buy groceries at the corner shop. Even better, you can use a Super SIM Card to complete transactions without an internet connection or even electricity.

This is a central bank digital currency in action. Users can download and use the digital yuan app in pilot areas across 17 provinces, though the date for a national rollout has not yet been announced.

Changing lives

Much of the project has been live for some time: Authorities in Changshu, a small city in Jiangsu province, are paying civil servants their salaries in digital yuan. Bus routes in Jinan will take digital yuan payments starting in July. A popular tourist spot called Sanya in southern China has shiny new digital yuan ATMs. And the digital currency is accepted in numerous retail outlets throughout the nation.

NOW READ: China’s BSN builds blockchain systems on its own terms — with no crypto and Xi’s guiding hand

But here’s the catch: For all its state support, the digital yuan has yet to be truly embraced by consumers. An attempt to get people to pay for transport using the digital yuan in Ningbo on China’s coast saw just over 8,000 users a day. That’s in a city with a population of almost 10 million.

Part of the problem may be that users often don’t see much of a difference between the digital yuan app and longstanding payment services such as Alipay and WeChat Pay. Some even refer to the digital yuan as “centralised Alipay” and have raised concerns about privacy.

‘The launch of the SIM card purse is expected to promote further usage of the digital yuan as it provides a new experience different from the QR code scanning model.’

Chen Bo

At the end of 2022, the People’s Bank of China said 261 million users possessed digital yuan wallets, which is about 18% of the population, not an insignificant number. Yet as of last August, the most recent data available, there was a cumulative 100 billion yuan ($14 billion) in transactions, or $53 per wallet. This pales in comparison to the 118 trillion RMB ($16.5 trillion) in transactions Alipay processed domestically in the 12 months leading up to June 30, 2020, according to its IPO filing.

Changing behaviour

It’s hard to get consumers to change their behaviour, especially when it comes to money. Still, with the power of the state behind the project, the digital yuan’s adoption rate may be poised to take off, and perhaps provide a preview of what’s to come in other nations committed to CBDCs.

The Chinese government has talked about a digital currency since 2014. Billed as a faster, cheaper and more secure way of spending, it’s backed by actual cash stored in the reserves of the People’s Bank of China (PBOC) and records transactions in a distributed ledger.

Local government and state owned enterprises are under pressure to build out its user base. The Shanghai Clearing House announced in June it would allow use of the digital yuan for bulk commodity trading clearing and settlement services.

Further usage

People like Chen Bo, director of the Digital Finance Research Center at the Central University of Finance and Economics, say that introducing hard wallets that don’t follow a QR code payment system will change that.

“The launch of the SIM card purse is expected to promote further usage of the digital yuan as it provides a new experience different from the QR code scanning model, which is widely used by third-party payment tools such as Alipay and WeChat Pay,” Chen told local media.

NOW READ: Powerful central bank group says crypto ‘amplifies’ risks and contributes nothing to society

One way the government and its partners have been trying to incentivise people to use it is through deals and discounts.

A department store in Shanghai gave customers a 100RMB ($14) coupon if they downloaded the app. China Construction Bank offered 150RMB ($21) off when you spent 380RMB ($53) or more. E-commerce giant JD teamed up with banks to roll out “gift packs” of digital yuan discounts for National Day last year.

Lotteries and promotions

Local governments in cities like Beijing have already given out the equivalent of millions of dollars in digital yuan to citizens through promotions including lotteries. Shops that are taking part in pilots offer discounts to citizens using the digital yuan.

It’s telling that even all this isn’t having the desired uptake. Even though the pilot program has not rolled out nationally and is limited to certain cities, former officials have expressed disappointment at its impact. The former PBOC director-general of research, Xie Ping, now a finance professor, said late last year that its applications needed to be widened beyond cash and consumption.

“Cash, bank cards and China’s third-party payment mechanisms have formed a payment market structure that has met needs for daily consumption,” he said, according to Reuters. “The common people are used to it, and changing it is difficult.”

NOW READ: Crypto bridge Multichain says it’s ceasing operations after CEO and sister arrested in China

Yet the lack of excitement at home isn’t stopping ambitions for pitching it globally.

The Guangxi Zhuang Autonomous Region in southern China, bordering Vietnam, plans to use the digital yuan at the upcoming China-ASEAN Expo and in border trade. Meanwhile, the Singaporean bank DBS has introduced a solution for clients in China to collect payments from customers in digital yuan.

Lim Soon Chong, the DBS group head of Global Transaction Services, suggested that it would be building on this launch with new digital payment solutions, including cross-border CBDC payments, according to a statement on the bank’s website.

Challenging the dollar

China wants to see a world in which the US dollar isn’t the top currency for international trade. Beijing encourages partners to settle transactions in yuan or local currencies instead.

In March, the yuan overtook the dollar as the most widely used currency for cross-border payments with China for the first time.

The digital yuan may play a role in this in the future. A six week trial last year saw $22 million in digital yuan transactions in a pilot using CBDCs for settling cross-border trade between China, Hong Kong, Thailand and the UAE.

Have a tip about crypto in Asia? Contact the author at callan@dlnews.com.

On the one hand, the asset class presents lenders with an opportunity to settle transactions swiftly, respond to demand for crypto services from customers, and delve into a potential wealth of investment opportunities in the $1.2 trillion market.

On the other hand, tapping into crypto means putting customers’ money at risk, pairing uneasily with the security and compliance standards banks must live up to.

Fireblocks is one of the firms trying to solve this conundrum. The digital assets infrastructure provider was founded in 2018. It secured an $8 billion valuation on the back of a $550 million Series E round in 2022.

It has set out to help existing customers including BNY Mellon and BNP Paribas tap into crypto.

Balancing the opportunities of crypto with the security of traditional finance solutions is no easy feat.

“[Crypto] looks like money, behaves like money, but it’s different,” Shahar Madar, head of security products and research at Fireblocks, told DL News.

“You have to find a way to follow the guidelines the banks already have. Mostly they want to innovate in this field, but they also are usually restricted in what they can actually do.”

Fireblocks recently expanded support to get banks to onboard crypto services with a new integration for hardware security modules, as well as public and private cloud computing.

The timing is notable.

The crypto winter that has harrowed the industry over the past 18 months shows signs of thawing.

Bitcoin has soared 75% in 2023, and Ethereum is up 53%, according to CoinGecko data.

The surge comes on the back of growing demand for crypto among institutions, with digital asset investment rising by a staggering 71.5% since the start of 2023, according to CCData.

At the same time, investment powerhouses like BlackRock and Fidelity have pushed into the industry by filing to launch spot Bitcoin exchange-traded funds.

“The overall enthusiasm around digital assets is on an upswing,” Joshua de Vos, research lead at digital assets research firm CCData, told DL News this week.

NOW READ: Flashbots bags biggest funding round as VC crypto investments jump 30% — we ranked who won most in July

Still, the industry faces a US regulatory crackdown spearheaded by Securities and Exchange Commission Chair Gary Gensler, who has fired off a barrage of lawsuits against leading firms including Coinbase and Binance.

Elsewhere, politicians feud over forthcoming crypto laws and influential organisations like the Bank of International Settlements have questioned if there really is a need for crypto that is balanced by its risks.

NOW READ: Powerful central bank group says crypto ‘amplifies’ risks and contributes nothing to society

For some banks, the difficulty of holding crypto while maintaining security standards just isn’t worth the hassle.

Others, such as the HSBC-owned Hang Seng Bank in Hong Kong, are taking a hard-line stance and recently began limiting services to companies that deal with crypto. A similar pattern has emerged in the UK and Australia.

It’s against this background that Fireblocks is trying to woo financial institutions to tap into digital assets.

Crypto services like SWIFT

Fireblocks is trying to create ways for banks to use crypto assets with the kind of security provided by the SWIFT payment system, which most big banks use thousands of times daily to transfer money.

According to Madar, that task is more difficult than it sounds, especially when considering financial criminals.

“You need to be very conscious about the fact that [banks] are huge targets,” Madar said. “They know that, attackers know that, and we know that.”

The SWIFT payment system has several checks and balances in place to discourage attackers.

Any attacker who wants to hack into a bank’s systems to steal money must access the system and remain undetected for a long time, making it easier for the bank to spot them.

Crypto, on the other hand, presents more opportunities for digital thieves to do quick hit-and-runs for the same reason the asset class is so attractive in the first place — ease of use.

NOW READ: ‘Most attackers are sloppy’: critics slam decision to live-tweet Curve exploit

Holding and sending crypto is more straightforward than traditional money.

Assets are secured by password-like private keys that the owner directly controls, and can be sent by simply putting in the receiving address and hitting send — no matter if you’re transferring $1 or $1 million.

But that is also the problem.

“If you’re able to steal that private key, you win,” Madar said.

While crypto offers many benefits such as trustlessness and near instant finality, it is also less secure for banks than systems like SWIFT.

Fireblock’s infrastructure essentially tries to find a balance between the two by making sending and receiving crypto more similar to SWIFT.

Its solution is still non-custodial, allowing banks to retain control and ownership of their private keys and wallets, but adds more checks and verifications to mimic the SWIFT system.

According to Madar, flexibility is a priority. Banks won’t be able to use Fireblock’s software if it isn’t compatible with what they already have.

“What we allow is for a hybrid solution,” Madar said.

More sensitive core components are deployed within the bank’s own system, he said. Then the bank sends requests via API to Fireblocks’ software at multiple stages of each crypto transaction.

The result is a ping-pong of confirmations between Fireblocks’ servers and the bank or financial institution, which should make it incredibly difficult for any potential attacker to intercept, spoof, or otherwise compromise its crypto transactions.

While security is paramount, it’s also crucial to preserve the trustless transactions that blockchain technology offers, Madar said.

“It’s about making and being able to deploy and use a platform that’s zero trust,” he said, referring to a system that requires all users, whether in or outside the organisation’s network, to be authenticated and continuously validated for security.

While some banks have jumped at the chance to offer crypto services, more conservative banks and financial institutions are reluctant to use Fireblocks’ solutions because they require sending messages outside their own computer systems, Madar said.

The fear is any communication to entities outside of the bank’s infrastructure present a possible attack vector, or a way for information on the bank’s activities to leak.

DL News asked Madar if Fireblocks plans to cater to such institutions in the future.

“Never say never,” he said, while also acknowledging the challenges of creating such a security system.

Often shortened to ESG, these criteria are commonly used by socially conscious investors to judge a company’s ethical and sustainable practices.

The report, co-authored by KPMG principal of technology risk Brian Consolvo and director of ESG Kirk Caron, refutes notions that Bitcoin has a mostly negative environmental and societal impact because of its high energy use and popularity among cybercriminals.

Bitcoin is ‘widely misunderstood’

“Despite Bitcoin’s increased adoption, it continues to often be a misunderstood technology and asset class,” the report said.

“This is a phenomenal endorsement,” Daniel Batten, an ESG analyst and co-founder of CH4 Capital, a fund that specialises in methane mitigation technologies, told DL News. “KPMG has done an outstanding job researching the nuances, because these conclusions, while true, are not obvious at first glance.”

According to report co-authors Consolvo and Caron, Bitcoin mining — the process of using powerful computers to solve the complex equations needed to validate transactions on the network — can help incentivise clean energy production, bolster financial inclusion, and even reduce greenhouse gas emissions from industrial activities.

Still, there’s no denying that Bitcoin uses a lot of energy.

A common comparison is that the top crypto asset uses as much energy as a medium-sized country such as Norway annually, per data from the Cambridge Centre for Alternative Finance.

A different perspective

But Consolvo and Caron see the energy use from a different perspective. Using the same data, they highlight that Bitcoin uses about the same amount of electricity as tumble dryers globally.

“Bitcoin miners can be a useful ally in the transition to more renewable energy sources and reduce emissions, despite its significant energy consumption,” the report said.

They also say those criticising Bitcoin’s energy use do so under the assumption that all industries should attempt to achieve net zero emissions.

Instead, the report states, “it’s helpful to compare the emissions associated with Bitcoin’s operations with the emissions of a wide range of industries and services.”

The KPMG report focuses on four key areas in which Bitcoin mining can support environmental goals. It argues that mining can help subsidise the cost of renewable energy, balance electricity grids through demand response, heat buildings through recycled heat from mining rigs, and incentivise methane reduction.

Methane in particular is one of the biggest contributors to climate change, and according to the US Environmental Protection Agency, is 25 times more potent as a greenhouse gas than carbon dioxide. It is emitted from many sources, such as coal mining, oil drilling and landfills.

Overstated societal impacts

Flaring — or burning — the gas breaks it down into carbon dioxide and water, and of course, releases energy. The report argues that using this energy to mine Bitcoin incentivises methane flaring and enables various industries to reduce the environmental impact of their operations.

NOW READ: Green Bitcoin mining now cheaper than fossil fuels says Sazmining COO as mining company taps Paraguayan hydro dam

As for social impacts, the report notes the negative impact of Bitcoin’s use in financial crime is overstated, citing a 2022 Chainalysis report which concluded the illegal use of crypto accounted for only 0.24% of all transaction volume in 2022.

Yet the report argues Bitcoin provides many benefits to society, particularly in low-income countries.

It enables low-cost cross-border payments — important for immigrants from developing countries such as Honduras, Haiti, and El Salvador who work abroad and regularly send money back to relatives in their home countries.

In Africa, Bitcoin mining is also helping subsidise electricity grids, helping bring power to millions and reducing costs for consumers.

For governance, the report lauds Bitcoin as a truly decentralised network that removes the need for trusted intermediaries.

KPMG’s investment in Bitcoin

Because Bitcoin is decentralised, no one single entity can exert control over it, making it highly resistant to attack and providing a high degree of confidence in the overall system.

NOW READ: Circle can’t shake SVB hangover as market cap dwindles to two-year low

The report argues that these attributes, coupled with the fact that Bitcoin’s governance and rules are hard coded, results in a system that cannot be abused or misused by those in power or even individuals with ulterior motives.

The Bitcoin-friendly report follows KPMG’s investment in Bitcoin, and the second-biggest cryptocurrency Ethereum, from its Canadian arm in 2022.

At the time, KPMG Canada managing partner Benjie Thomas said the investment reflected the firm’s belief that “institutional adoption of cryptoassets and blockchain technology will continue to grow and become a regular part of the asset mix.”

Launched in February, Project Evergreen offered HK$800 million ($102 million) of environmentally friendly green bonds to investors through the Goldman Sachs Digital Asset Platform. Project Evergreen is built on the Canton Network, a finance-focused blockchain whose backers include BNP Paribas, Cumberland, Deloitte, and Microsoft.

With the global issuance of tokenised bonds hitting $3.9 billion as of March, the HKMA is keen to ride the tide of tokenisation while navigating the complexities of integrating DLT with existing financial systems.

“Despite the increasing number of issuances globally in recent years, bond tokenisation is still at its infancy,” said HKMA Chief Executive Eddie Yue in a forward to a Project Evergreen report published on Thursday. “Multiple challenges would have to be overcome for it to be widely adopted.”

NOW READ: Hong Kong’s new crypto rules may be a boon for retail investors and a challenge for platforms, says Lennix Lai at OKX

Still, he added that the HKMA would continue to work with stakeholders to tackle remaining issues “with a view to further enhancing our ecosystem to support tokenisation’s broader adoption.”

The test and the takeaways

In 2021, HKMA began conceptual tests to tokenise green bonds, culminating in Project Evergreen. The project utilised DLT to handle various aspects of bond issuance, from initial offers to coupon payments, with an aim to test the financial infrastructure and the legal and regulatory environment throughout the bond lifecycle.

“Project Evergreen has successfully demonstrated the possibility of deploying DLT to a real capital markets transaction under the existing Hong Kong legal framework,” said Yue.

A key upside was the elimination of manual errors through the removal of physical certificates in traditional bond processes. The use of DLT enables real-time data synchronisation, enhancing efficiency, transparency, and privacy across multiple organisations, the report found.

On-platform payments were made possible with Hong Kong dollar cash tokens minted by a unit under the HKMA.

Fragmentation and legal hurdles

The report also highlighted some issues with the project. “Existing legal and regulatory regimes may also need to be fine-tuned to keep up with — and facilitate — technology adoption. " Yue warned.

NOW READ: Bitcoin casinos and burger joints selling Tether — how Hong Kong fell back in love with crypto

He added that fragmentation could become an issue as more financial institutions come up with their own tokenisation solutions. “It will be crucial to consider how different solutions can connect and interact with each other as well as conventional systems,” he said.

The potential for adoption of DLT in the broader market remains to be seen, especially in retail-level tokenisation, which could widen investor bases and automate trading processes.

The HKMA and the Government of Hong Kong are in discussions to conduct further tokenised issuances. The focus is on addressing fragmentation, fine-tuning regulatory regimes, and paving the way for wider adoption in capital markets.

“DLT holds promise for revolutionising the operation of the financial markets,” the report stated. “Project Evergreen is an important step forward in promoting the adoption and realisation of the full potential of DLT in the bond markets.”

Callan Quinn, DL News’ Hong Kong-based Asia correspondent, covers the crypto industry in the region. Have a tip? Contact the author at callan@dlnews.com.

But Allaire has his eyes set on 2024 for an explosion in usage. Speaking on stage in an interview at the Token2049 conference in Singapore, he laid out an optimistic vision for the future of digital currencies.

He cited “a lot of things that are lining up” that will serve as catalysts for broader adoption, ranging from improvements in the underlying technology to greater regulatory clarity.

Asia focus

Against the backdrop of the bull market and regulatory woes in the US, Asia has emerged as a focus point for many crypto firms.

NOW READ: Lure of Treasuries behind Circle stablecoin’s $29bn slump — and USDC could fall even further

“Asia is itself, in the aggregate, the most dynamic fast-moving market in the world — and that’s independent of crypto and fintech,” Allaire said.

His comments resonate with a recurring theme at Token2049, where other industry giants like the Gemini founders, Cameron and Tyler Winkelvoss, and Binance founder Changpeng “CZ” Zhao, also emphasised the surging momentum and interest in blockchain technology in the region.

Singapore and Hong Kong have especially gained attention for their crypto-friendly regulatory frameworks, standing in stark contrast to more opaque jurisdictions, including the US.

Circle partners with Grab

Earlier in the day, Circle announced a partnership with Grab, the Southeast Asian ride-hailing super app that offers not just deliveries and rides but also financial services.

Although not well known outside the region, Grab is Southeast Asia’s first ‘decacorn’ and recently reported a 77% year-over-year revenue growth in the second quarter to $567 million.

NOW READ: A crypto comedy night and the wristband black market at Token2049

The partnership aims to introduce a “Grab Web3 Wallet,” facilitating blockchain-based financial transactions for Singaporeans using the app. It will allow users to earn rewards and collectibles, and use non-fungible token, or NFT, vouchers.

Singapore footprint

This partnership enhances Circle’s expanding footprint in Singapore, which was fortified by it receiving a Major Payment Institution License from the Monetary Authority of Singapore in June.

The company inaugurated its regional office in May and has also joined forces with Tribe, Singapore’s first government-supported blockchain ecosystem builder, to offer specialised training programs for emerging Web3 developers.

Allaire expressed the company’s intent to engage with traditional internet companies to make the transition to web3 smoother for users.

“We’re focused on working with established consumer internet companies, established payment companies, digital wallet companies. You’re going to see partnerships with a lot of different firms like that,” he elaborated.

This strategic vision was underpinned by recent news that Visa, a payments giant, has opted to integrate USDC on the Solana blockchain for merchant settlements.

“It’s a really, really powerful statement: a giant payments powerhouse embracing this for merchant settlement,” Allaire said.

Callan Quinn is DL News’ Asia Correspondent, currently attending Token2049 in Singapore. Reach out to her at callan@dlnews.com.

Users have moved almost $400 million worth of crypto to the blockchain and its DeFi ecosystem is now the eighth-biggest when measured by the value of crypto deposits, ahead of many long-running competitors including Solana and Kava. And Friend.tech, a crypto-based social media platform built on Base, has been the talk of the summer.

Still, the end of a rewards program that helped fuel that growth will test its momentum. In the past year-and-a-half, similar programs at a pair of competing blockchains created a surge in activity that fell off a cliff when the programs ended.

Jesse Pollak led the development of Base and has served as its unofficial spokesman since Coinbase unveiled it earlier this year. He said the rewards program, “Onchain Summer,” may succeed where others failed.

Transaction activity

“If you look at the data, we’ve definitely seen some slowing down, but there’s still really strong transaction activity,” he told DL News.

Base is a layer 2 blockchain on Ethereum, a blockchain on top of a blockchain.

By batching and appending transactions to Ethereum, layer 2 blockchains make it possible to use the notoriously expensive network at a fraction of the cost.

To spur adoption, layer 2 blockchains Arbitrum and Optimism introduced short-lived rewards programs that allowed users to mint NFTs after moving crypto and completing a series of tasks.

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When those programs ended, in June 2022 and January 2023 respectively, daily transactions and revenue cratered, according to data compiled by Blockworks Research.

When Base went live on Aug. 9, it tried something similar.

The 23-day Onchain Summer campaign encouraged users to move crypto to Base and mint commemorative NFTs or use certain applications. According to Coinbase, users owning more than 268,000 crypto wallets minted about 700,000 NFTs.

Transactions and users on Base peaked on Aug. 21 then declined sharply, according to data compiled by Sixdegree, a crypto research firm.

On that day, more than 145,000 users engaged in about 1.4 million transactions, according to Sixdegree. By Sept. 3, those figures were a hair more than 70,000 and 350,000, respectively.

Bouncing back

They have since rebounded, with transactions approaching 1.4 million on Wednesday, according to Sixdegree. The Base blockchain explorer, which provides up-to-the-minute data, showed transactions hitting an all-time high Thursday.

Pollak said the difference in Base’s rewards program means the decline will be short-lived and less pronounced.

“If you look at other L2s that have launched, they’ve tried to do these [rewards programs], but I don’t think any of it really captured the collective energy of the world because they weren’t real things,” he said.

Blackbird, a crypto company that lets users earn rewards for dining at affiliated restaurants, gave Onchain Summer participants a free dessert when they ordered dinner at participating restaurants, for example.

Parallel, a blockchain-based trading card game, gave participants a starter deck for 0.05 Ether.

“Anytime you do a big push on marketing and distribution, you’re always going to have a tail-off at the end,” Pollak said. “I think one of the things that’s really different about Onchain Summer was, this wasn’t manufactured quests that people were doing. This was, like, real utility that people were experiencing on chain, whether they were buying a restaurant pass for Blackbird, or they were buying a pack of cards for Parallel.”

NOW READ: Solana enjoys post-FTX ‘renaissance’ on back of network and DeFi upgrades

Patrick Scott, an adviser to DeFi projects, said the reason for Base’s resilience may be simpler.

Friend.tech, a platform that lets users of X, formerly Twitter, issue and trade token shares in themselves, is surging in popularity.

On Wednesday, almost 550,000 Base transactions originated from Friend.tech, according to OP Labs data analyst Michael Silberling. Over the previous seven days, the app accounted for 27% of transactions on the blockchain; in the past 24 hours, it was almost one-third.

Scott said Friend.tech might be attracting users amid speculation it may offer its own kind of rewards program: an airdrop, a common crypto marketing tactic in which frequent and early users are gifted newly minted tokens.

“So interestingly, the activity hasn’t been as tied to the NFT program as it was on Arbitrum and Optimism,” he said. “Yes, you’re gonna get a lot of people who just want the NFT, but it’s kind of a cheap way to bring some attention to their ecosystem and to onboard people who are already using crypto onchain.”

Maturing ecosystems

To be sure, transactions at Arbitrum and Optimism have recovered since the ends of their rewards programs, and transactions on all layer 2 blockchains now dwarf those on Ethereum, according to data compiled by 21.co.

Scott attributed their success this year, in part, to maturing ecosystems. Arbitrum and Optimism — as well as a slew of protocols on each — have been running for well over a year and weathered several industry crises.

“If they’ve been around for two years now, and they’ve been through Terra and FTX and everything, then it would be pretty unlikely that they would take the money and run after making it through all that,” he said.

NOW READ: Aerodrome just outpaced all DeFi protocols on Coinbase’s Base with $170m of deposits

For the time being, Base’s fortunes seem tied with those of Friend.tech, he added.

“[Base] also has a DeFi ecosystem, and the DeFi ecosystem has attracted a lot of liquidity,” he said. “However, in terms of actual user activity, a lot of what’s happening is on the Friend.tech app.”

And Friend.tech has so far shown no signs of slowing down.

Core Scientific, one of the biggest owners and operators of high-powered digital infrastructure for Bitcoin mining and hosting services in North America, said it had received an unsolicited non-binding proposal from CoreWeave to acquire all of its outstanding shares on a fully diluted basis for $5.75 per share in cash.

This unsolicited proposal immediately followed Core Scientific and CoreWeave entering into a separate series of 12-year contracts for Core Scientific to provide about 200 MW of infrastructure to host CoreWeave’s high-performance computing services.

Core Scientific’s board consulted with independent advisers in reviewing CoreWeave’s proposal and evaluating the company’s growth prospects and near- and long-term value creation potential.

Shareholder interests

It determined that the proposal significantly undervalued Core Scientific and was not in the best interests of its shareholders.

Core Scientific emerged from Chapter 11 bankruptcy earlier this year.

The private placement closed on May 30, according to a Bitdeer news release.

“We regard Bitdeer as one of the strongest vertically integrated operators in the Bitcoin mining industry, differentiated by its cutting-edge technologies, and a robust R&D organisation,” said Paolo Ardoino, CEO of Tether.

He added: “Bitdeer’s proven track record and world-class management team are perfectly aligned with Tether’s long-term strategic vision.”

Bitdeer said it intends to use the net proceeds from the sale to fund its data center expansion, ASIC-based mining rig development and for working capital and other general corporate purposes.

“With Tether’s support, we are poised to accelerate our growth and continue our leadership in sustainable and efficient Bitcoin mining,” said Linghui Kong, chief business officer of Bitdeer.

Bitdeer’s founder and CEO is Chinese crypto billionaire Jihan Wu, who in 2013 co-founded Bitmain, which has become the world’s biggest computer chip company for Bitcoin mining.

Headquartered in Singapore, Bitdeer has deployed data centers in the US, Norway, and Bhutan.

“We will decide to have one location from where to have our supervisory activities. We haven’t yet decided which that hub will be, and we’re taking our time to think really carefully about what is the right location,” Tom Duff Gordon, vice president of international policy, said at a Brussels summit organised by Blockhain for Europe.

The comments come as CEO Brian Armstrong rails against US regulators amid an industry-wide battle to establish crypto firms’ legal standing.

The Securities and Exchange Commission charged Coinbase with allegedly operating an illegal exchange and permitting investors to trade in assets that aren’t registered as securities.

Meanwhile, a new European crypto regime is changing up the regulatory landscape in Europe.

The Markets in Crypto-Assets legislation, also known as MiCA, allows firms to access the entire European market if they get the licence. But first, they need to pick one member state to get licensed.

“We want to have a regulator that we think is a trusted and a tier-one regulator,” Gordon told a Brussels event. “We want to have access to talent.”

For Coinbase, another decisive feature of the winning hosting member state is a supporting government.

“Not necessarily just of the company ... but supportive of the vision and of the technology and space of the tech sector,” Gordon said.

“We will choose one, but that doesn’t mean that we will cease all operations across Europe,” Gordon said.

Coinbase this year has ramped up attacks on the SEC for what it says are unfair regulations for crypto.

Armstrong said in June: “The SEC has taken a regulation by enforcement approach that is harming America.”

He also accused the SEC of “sketchy behaviour,” and said the agency engaged in “intimidation tactics behind closed doors.”

In the meantime, Coinbase is continuing to collect individual registrations from EU member states, which allows the exchange to target national populations.

On Monday, Coinbase successfully registered with the Spanish central bank.

Italy, Ireland, and the Netherlands have also been ticked off the list for Coinbase within Europe over the past year.

Under MiCA, a registration in individual EU countries now will allow firms to continue offering their services as the new laws are implemented and jurisdictions transition into the new set of rules over the coming years.

Their answer: Publish Proof of Reserve “attestations’ to show just how much crypto firms have in their wallets to back up their deposits.

Yet now this approach, dubbed PoR, is being branded “dangerous and inadequate” by accounting firms Nephos Group and KYAX.

“What does Proof of Reserves actually prove?” Joe David, founder and CEO at Nephos Group, told DL News. “That at one snapshot point in the month you held assets in a wallet.”

False reassurance

David said PoR as it stands now is counterproductive. “Proof of Reserves is actually dangerous in that it presents to the market a false reassurance of solvency, when it proves nothing of the sort,” he said.

Nephos and KYAX have teamed up to propose a new methodology to help crypto firms prove they are solvent, and help them provide customers with the same standards of transparency commonplace in traditional finance.

Their methodology, which they call KYA — or Know Your Assets — aims to help restore trust in an industry beaten down by a series of crypto crashes which collectively cost investors tens of billions.

“In crypto, there’s a big push towards making things trustless,” Matthew de la Fuente, the CEO of KYAX, told DL News. “But it’s made people not respect the need for trust.”

For De la Fuente, the subject hits close to home. He was crypto lender Celsius’ vice president of strategy and planning when the firm suddenly collapsed in June last year, bringing down with it $12 billion in assets under management.

According to Shoba Pillay, a former federal prosecutor assigned to investigate Celsius by a US bankruptcy court, the company’s financial mismanagement meant it had been “insolvent since inception.”

Proof of Reserves

In response to last year’s spate of crypto bankruptcies, crypto exchanges including Binance, OKX, Bitfinex, and Kraken started using Proof of Reserves to reassure customers they held adequate funds to back customer deposits.

Proof of Reserves involves taking a snapshot of a company’s wallet balances and from them creating a cryptographic proof. The company then hires an auditing firm to sign off on this proof. Customers can check the proof to see how much crypto an exchange had on its books at the time of the snapshot.

“When we say Proof of Reserves, we are specifically referring to those assets that we hold in custody for users,” said a Binance blog post explaining its Proof of Reserves attestations. “This means that we are showing evidence and proof that Binance has funds that cover all of our users’ assets 1:1.”

These snapshots are meant to show that a given company — usually a crypto exchange — is solvent. Ever since PoR emerged it has drawn fire.

“The biggest issue by far is that there’s no verification of total liabilities,” 0xngmi, a DefiLlama developer and creator of the website’s Proof of Reserves dashboard, told DL News. DefiLlama is DL News’ sister company.

“It’s impossible to check that the info on total liabilities is correct, which means that you can’t check that total deposits are greater than liabilities.”

‘The industry relying on this framework is an accident waiting to happen.’

Matthew de la Fuente, KYAX

0xngmi said gaps in the data provided by crypto exchanges as well as inconsistencies in their reporting pose additional challenges.

“Some exchanges, like Kraken, don’t report the addresses where they hold crypto, so for those cases it’s impossible to independently verify their total deposits,” he said.

Kraken did not immediately respond to DL News’ request for comment.

KYAX and Nephos say they know these pitfalls all too well.

De la Fuente called Proof of Reserves “dangerous and inadequate” and said it proves very little from an accounting or legal perspective.

“Consumers don’t seem to know that accountants, attestors and auditors often don’t sign off on the financial data itself. The industry relying on this framework is an accident waiting to happen,” he said.

Mazars, an auditing firm that worked with Binance, Kucoin, and Crypto.com, stopped providing Proof of Reserves reports last year, citing concerns over the way its reports were being understood by the public.

The firm said that its Proof of Reserves reports did “not constitute either an assurance or an audit opinion on subject matter.”

‘We want verified sign-offs in place on who can move funds and for what reasons.’

Matthew de la Fuente, KYAX

Instead of Proof of Reserves, David and De la Fuente’s KYA system seeks to provide a more holistic assessment of crypto businesses’ financial circumstances.

Rather than focusing exclusively on reserves, it integrates offchain risks, liabilities and governance, and brings them onchain through attestations. But this occurs only after an independent authority has signed off on them, which is similar to the audits of traditional companies.

Sufficient transparency

The idea is that KYA will become a proven and trusted methodology for ensuring crypto companies are following best practices and providing sufficient transparency to their customers.

“We want verified sign-offs in place on who can move funds and for what reasons,” De la Fuente said. “If there were an exchange with 100 employees and all of them had the ability to move customers’ funds, would you trust it?”

Still, creating a better system is only a start.

With a few exceptions, such as the European Union’s landmark MiCA bill, most jurisdictions have yet to introduce comprehensive regulations for crypto companies.

Additionally, many crypto firms choose to register in places with lax financial oversight, such as the Seychelles or the Cayman Islands.

With nothing to ensure that crypto firms put their finances in order and provide greater transparency and checks, it may be difficult to convince them to adopt the KYA methodology.

But this hasn’t fazed David and De la Fuente.

They said the response has been positive, and that they’ve worked with several crypto firms and exchanges on the KYA methodology, but didn’t name them. “They’re names you’ll have heard of,” David said.

Still, while the pair acknowledged the difficulty in building back trust in an industry plagued by malpractice, they expressed optimism about its future.

“The whole world is in scope for coming on chain,” De la Fuente said, “We want to be part of the process that attests that people, communities and companies can trust this movement and embrace the transition.”

Tim Craig is DL News’ Edinburgh-based DeFi correspondent. Reach out to him with tips at tim@dlnews.com.

That’s according to new analysis from financial research firm PitchBook, which covers crypto investment trends.

It found that not even the recent bull run in Bitcoin has done anything to sway venture capitalists to return to their pre-crypto winter capital injection levels.

This year, investors say, “will feature a wave of zombie funds — VCs that are unsuccessful in raising new funds but continue to manage an existing portfolio,” PitchBook analysts wrote.

The analysis comes as investment in crypto declined by 72% to $6.2 billion in 2023, down from about $22 billion in 2022, according to data from DefiLlama.

The number of projects raising money dropped to 717 from 732 during the same period, with funding declining over the course of the year.

The meant 2023 ended 2023 at a lower level than the beginning — albeit with a slight spike in November.

The new data comes at a key moment for the crypto industry. Market watchers expect a crypto bull run fuelled by the approval of US spot Bitcoin exchange-traded funds, new laws, and wide adoption by traditional financial firms.

And the areas in which investors injected capital in 2023 may show where they expect growth in the future.

DefiLlama tracks money invested, who the investors are, the type of funding round, industry and sector, and when the cash injections were made.

The platform collects data from multiple sources. Still, in some cases there is no data on how much money was raised, and descriptions or categories may be missing.

Who was the biggest investor in 2023?

Investment management firm Kingsway Capital injected the most money into the crypto ecosystem last year, according to DefiLlama’s data.

It topped up the coffers of three firms — Blockstream, Blockchain.com and River Financial — to the tune of $270 million in total.

Other notable investors included traditional finance behemoths like Goldman Sachs, BNP Paribas, Credit Suisse, and PayPal Ventures, as well as Binance Labs, the venture capital arm of beleaguered crypto exchange Binance.

Which crypto and DeFi organisation raised the most money in 2023?

Five organisations’ crypto rounds outstripped the rest in 2023.

Interoperability protocol Wormhole secured the biggest round of the year in November when it bagged $225 million from investors Brevan Howard, Coinbase Ventures, Multicoin Capital and others.

Line Next, a subsidiary of the Korean web3 company Line Next Corporation, attracted the second-biggest round in December, when it secured $140 million for development of a global NFT platform from Crescendo Equity Partners.

In January 2023, Kingsway Capital, along with Fulgur Ventures, and Cohen & Company Capital Markets raised $125 million for Blockstream, a blockchain technology company for Bitcoin and blockchain infrastructure.

LayerZero, an omnichain interoperability protocol, got $120 million in April for infrastructure. The lead investor was a16z, along with Christie’s, Sequoia Capital, Samsung Next, Bond, Circle Ventures, and OpenSea Ventures.

Worldcoin, OpenAI founder Sam Altman’s eye-scanning crypto project, bagged the fifth biggest raise of 2023. It secured $115 million from Blockchain Capital in May.

You can explore the available information about the biggest raises from 2023 in DL News’ interactive chart:

Which crypto sector attracted the most investment in 2023?

While 2023 saw investors pour money into a wide range of crypto sectors, some attracted more than others.

The infrastructure category raised the most capital, securing $1.3 billion in total. This category included projects developing blockchain infrastructure, digital asset infrastructure, web3 payments, and AI technology.

Wormhole secured the biggest round of the year in this category and, as pointed out earlier, in general.

“Investors tend to skew toward infrastructure early in the cycle,” Chris Carapola, co-founder of Curvance, a DeFi protocol, told DL News in December. It’s easier for venture firms to identify promising infrastructure providers than specific applications, such as DeFi protocols, he said.

It was also a good year for gaming, despite web3 games still lacking a blockbuster success that might propel blockchain-based gaming into the mainstream.

Gaming recorded $544 million across 66 raises. Believer, a gaming platform, secured the biggest round in March, when Lightspeed Venture Partners injected $55 million into the startup.

Rounds like that have fuelled optimism towards the web3 gaming revolution.

“We expect blockchain gaming and the open metaverse to continue to attract significant investment due to growing user awareness of digital ownership and the other advantages of decentralisation,” Yat Siu, chairman at web3 game and investment company Animoca Brands, told DL News in December.

The third-biggest category was NFTs. This sector attracted more than $392 million across 49 funding rounds.

In comparison with the previous year, the principal categories changed their order. DeFi was a leader in 2022, followed by infrastructure, NFT, and gaming.

Ana Ćurić is DL News’ data correspondent. Have a tip? Contact the author at ana@dlnews.com.

The city’s Securities and Futures Commission made the announcement as part of its three-year strategic plan released on Tuesday.

Hong Kong has been at the forefront of governments tokenising securities. Last year, the city issued tokenised green bonds, which are designed to finance projects that minimise greenhouse gas emissions.

The plan also includes measures to foster a responsible and secure fintech ecosystem with blockchain and web3 technologies.

Hong Kong all in on web3

The city has embraced web3 technology as a way to restore its reputation as a financial hub. Hong Kong has taken a hit in recent years internationally due to political pressure from China and, until earlier this year, strict Covid-19 requirements.

Hong Kong’s stock market, home to some of China’s corporate titans, has lost $6 trillion in value since its peak in 2021, according to Bloomberg data.

The city is also contending with the rise of India and its booming economy as a “money centre”, leaving Hong Kong in the dust and possibly in a bit of an existential crisis.

This week, India’s stock market capitalisation overtook Hong Kong’s for the first time, with shares listed on Indian exchanges totalling a combined value of $4.33 trillion on Monday versus $4.29 trillion in Hong Kong, according to Bloomberg News.

Even as the SFC tries to stimulate crypto action it’s also struggling to protect investors from scams.

Lawmakers and investors have criticised the SFC for failing to do enough to shut down, or even identify, the actors behind suspicious crypto exchanges such as JPEX.

Investment scams

It has pledged to improve public awareness of crypto and investment scams. Ads warning people to use regulated virtual asset platforms have since appeared on buses around the city.

“The Commission [will] be on a stronger footing to keep investors out of harm’s way and bring wrongdoers to justice when financial crimes nowadays come in any shape and form, as well as to bring the full range of resources and tools at its disposal to achieve positive regulatory outcomes,” said SFC Chief Executive Officer Julia Leung in a statement.

Not to be left out of the limelight, the Hong Kong Monetary Authority is also seeking public opinion on a proposal to let banks share customer account information to prevent and detect financial crime.

Its chief executive, Eddie Yue, recently found himself joining the roster of public officials and politicians in Asia who’ve become subject of deepfakes in which they promote investment scams, including encouraging people to invest in crypto.

Bulletins:

China wants to standardise the metaverse

China has announced the members of its Metaverse Working Group, which it’s set up with the aim of standardising metaverse projects in the country.

The lineup includes the usual suspects such as Huawei, Tencent, Baidu and Ant Group. It will also feature government agencies and academia.

Hong Kong’s ‘farcical’ crypto crime thriller

The crypto movie genre has never quite taken off. But that hasn’t stopped people trying. The latest attempt is the movie “Crypto Storm,” released in Hong Kong on Thursday.

This fresh chapter in the “Storm” movie series pits law enforcement heroes against a bank on the brink that tries to turn its fortunes around by dabbling in crypto exchanges.

The South China Morning Post dubbed it “the most farcical crime thriller series Hong Kong cinema has produced in the past 10 years”.

Got an Asia crypto story? Get in touch with DL News’ Asia Correspondent at callan@dlnews.com.

The stock trading app’s crypto wallet will enable its users to use Arbitrum, an Ethereum layer 2 blockchain, to process crypto trades.

This is the latest push by Robinhood to tap into the crypto market.

“We want to be kind of the on-ramp to the crypto world,” Johann Kerbrat, the general manager of Robinhood’s crypto arm, told DL News in an interview in December.

Robinhood expanding its services is the latest in a string of advances made by fintech firms like Revolut, PayPal and Venmo to launch and expand crypto services.

Wall Street giants like BlackRock, Fidelity, and JPMorgan have also muscled into the market through spot Bitcoin exchange-traded funds and other digital asset services over the years.

These moves come as the price of Bitcoin is trading around the $63,000 mark — a level not seen since late 2021, which has also raised the value of Ether and other cryptocurrencies.

Robinhood’s Arbitrum wallet integration

Robinhood has made crypto a key part of its strategy over the years. The stock-trading app has about 11 million monthly users, according to its latest financial results.

The company’s crypto arm drove its growth in the last quarter of 2023. Cryptocurrency revenue grew 10% year-over-year to $43 million, almost one-quarter of the company’s $200 million in transaction-based revenue between October and December.

The self-custody crypto wallet is part of that drive. Released a year ago, it lets users manage crypto without the aid of an intermediary.

In December, it launched a crypto trading service in the European Union.

While Robinhood doesn’t collect fees on transactions made through the wallet, users still have to pay gas — the transaction fees of the various blockchains the wallet supports.

Users can send and receive crypto on several blockchains, including Ethereum, Bitcoin, Dogecoin, and Polygon, as well as layer 2s Arbitrum, Optimism, and Base.

Users have been able to trade crypto on Ethereum and Polygon via the 0x API and LI.FI decentralised exchange aggregators, respectively.

“Ethereum gas fees are an essential part of securing the network, but these same fees can hinder adoption,” Kerbrat said in a prepared statement.

“Accessing and transacting on L2s has historically been difficult to non-crypto natives, but Robinhood Wallet now helps strip away the complexities to help onboard those new to web3.”

Robinhood said it would partner with Arbitrum to enable swaps across blockchains “and other campaigns that lower the barriers to use web3 on Robinhood Wallet.”

Aleksandar Gilbert is DL News’ New York-based DeFi correspondent. Got a tip? Email him at aleks@dlnews.com.

The challenger bank unveiled a new feature on Wednesday. Dubbed Revolut Ramp, it will allow its 40 million users to buy cryptocurrencies and deposit them directly into MetaMask wallets.

“This partnership is really about giving our users what they want — more control over their crypto, in a straightforward way,” Lorenzo Santos, senior product manager at Consensys, the company behind MetaMask, said in a statement on Wednesday.

“It also plays a crucial role in fostering broader crypto adoption, opening up the world of crypto to more people.”

MetaMask has 30 million users, the company said.

The Revolut Ramp launch comes as traditional finance firms increasingly muscle into crypto.

Most noticeably, Wall Street giants like BlackRock and Fidelity have powered the spot Bitcoin exchange-traded fund boom this year, a key driver behind why the cryptocurrency reached a new all-time high on Tuesday.

However, smaller firms, like stock-trading app Robinhood, payments behemoth PayPal, and mobile payments firm Venmo have also grown their cryptocurrency services lately.

Revolut’s crypto push

Revolut Ramp is available through MetaMask’s app, browser extension, and its Portfolio platform. Users can purchase up to 20 cryptocurrencies, including Ethereum, USDC, and Shiba Inu.

Ramp is designed to skip additional verification for existing Revolut customers by leveraging know-your-customer processes already conducted via the Revolut app.

New customers can still use Revolut Ramp, but must undergo the same KYC process that the neobank’s users are subjected to.

A “small fee” for purchasing crypto with Revolut Ramp on MetaMask will apply, which will be displayed before the purchase, typical of all services through the wallet app.

MetaMask and Revolut did not specify their exact fee structure and did not return requests for comment.

Revolut first launched its crypto trading business across Europe in 2017. During the 2021 bull run, it contributed to its £39.8 million profit.

Crypto contributed “up to 30%, 35% in revenues in 2021,” CEO Nikolay Storonsky told Bloomberg TV in 2022.

Those tailwinds ceased in 2022 when Revolut went back in the red, revealing a £25.4 million loss in its 2022 financial results, published in December.

Despite the headwinds and scandals like the collapse of FTX, Storonsky told fDi Intelligence in 2022 that Revolut was “doubling down on crypto products.”

Sebastian Sinclair is a markets correspondent for DL News. Have a tip? Contact Seb at sebastian@dlnews.com.

Andreessen Horowitz’s crypto arm announced 25 early-stage startups that will participate in its Spring 2024 Crypto Startup Accelerator programme.

Over 10 weeks, the programme will arm the new founders with guidance and resources from the a16z crypto team, “speeding up their path to product-market fit and setting them up for long-term growth.”

But some of them aren’t very crypto-specific at all. The startups range from a blockchain investment bank to a decentralised version of SkipTheDishes.

A16z crypto injected $128 million across two crypto projects — the restocking project EigenLayer and web3 privacy project Espresso Systems — in the first quarter of the year, according to DefiLlama.

Here are five of the most off-piste crypto a16z-backed ventures coming to market.

AminoChain

AminoChain is a “bio-sample marketplace” that connects labs and clinical sites with biopharma companies.

The company will allow labs and medical institutions to share information with stakeholders and facilitate specimen transactions.

“AminoChain participants can track and trace where their samples go and how they are used in scientific research and development,” the company wrote in an X post.

Collar Protocol

Collar seeks to build “the investment bank of the future.”

The protocol will allow retail investors to enter concentrated positions while avoiding liquidation — an arrangement usually reserved for high-net-worth individuals at traditional investment banks.

Collar says it plans to develop additional products with traditionally high barriers to entry to retail investors.

Nosh

Nosh is a Colorado-based, locally-owned “delivery service collective.”

The company operates similarly to delivery services such as SkipTheDishes or Uber Eats, except that it is restaurant-owned and driven by blockchain technology.

“Nosh was born out of restaurant owners coming together to create an alternative to the predatory practices of big-tech food delivery businesses,” according to the company’s website.

Nosh lists 218 restaurants across three cities in the state.

Playmint

Playmint is a UK-based blockchain gaming company.

Its principal project, Downstream, is an on-chain massively multiplayer online game that allows users to build their own games within the game.

The project will focus on builders, player engagement, and eventual monetisation, according to the company.

Scrypted

Artificial intelligence-focused firm Scrypted is “building decentralised, self-owning, autonomous agents and games.”

The company’s website shows several projects, including AI-generated web3 games and AI-assisted development platforms.

Scrypted says it has “all the tools in hand to create Autonomous Virtual Beings,” a concept outlined by CEO Tim Cotten in a blog post which seeks to create AI entities that “own themselves.”

Blockchain users will be able to invest in AVBs and play online games with them as if they were human players, according to Cotten.

Tyler Pearson is a markets correspondent at DL News. Got a tip? Email him at ty@dlnews.com.