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The Smart Money Series: How to Navigate the the Blockchain & Crypto Space by Following Smart Money with Gideon Ajose (1)

As the financial market unwinds and keeps on revealing new intricacies by the day it is instructive that investors begin to look before they leap. This is not only to prevent losses but also to coordinate industry response to the growing concerns about the usability of blockchain technology away from the hype. 

In the race to profit in the ever-volatile crypto market, funds have been made and lost. In the current bear market, most people are very much skeptical of entering the crypto market with any amount of funds. 

But I have a solution for you. As a community manager in the blockchain space, I have gained certain insights which I believe can help you profitably and safely navigate the risks and opportunities in the blockchain & crypto space.  First, community. Being a part of a community gives you access to relevant and timely information. Also, you must understand protocols and projects in the ever-dynamic blockchain space, and how to investigate them for possible investment purposes. As a crypto tutor and fundamental analyst, one of the ways I follow smart money is by penning a number of protocols and projects that have been investigated and have raised funding from the most responsible players in the industry. 

To guide you, I will share my list with you. This list is not exhaustive and nothing in this article should be taken as financial or investment advice. I am evaluating these protocols and projects with respect to the level of trust that has been placed on them generally and what solutions or improvements they are bringing to the blockchain space. 

VC funding is Smart Money Worth Following

In the last 3 months, VCs have invested a total sum of $727.7m in the crypto and blockchain space. This is smart money. Whether as an investor or even user in the fast-moving and fast-changing blockchain and crypto space, it makes sense to know where smart money is going into. This, of course, does not guarantee smart returns, but it at least lets you know where demand and supply is or is headed. 

In this 3-piece series divided into 3 parts and 9 categories, I cover some of the projects funded by 9 VCs or crypto fund investors. These VCs are Binance Labs, Coinbase Ventures, Multicoin Capital, and Polychain Capital. Other crypto investors are Andreesen Horowitz, Blockchain Capital, Fabric Ventures, Framework, and Jump. Under each category, you get to know the project invested in, how much was raised, and what aspect of blockchain each project is focused on. Further, you get to know whether a token has been listed (or if the listing date is anticipatory) and how you may participate as a community member. Beyond this, I will be drawing parallels with respect to previous projects that various VCs have invested in and their performance rate or success-to-failure ratio. 

Today, let’s dive into the first part where we follow smart money by briefly studying the crypto-funding moves of 3 out of the 9 VCs and the projects they are currently investing in. I hope you enjoy it and find it resourceful.

VCs, Raises, and the Projects Smart Money is Moving Into

I. Coinbase Ventures

Coinbase Ventures invests in “exceptional founders who share Coinbase’s mission of creating more economic freedom for the world”. Coinbase ventures prides itself as being “strategic partners for founders” and “take a collaborative approach to investing”, supporting founders through operational experience, distribution, strategic partnerships, and more.” Its portfolio includes Alchemy, Etherscan, Magic Eden, Graph Protocol, OpenSea, and UniSwap.

  1. Perennial: Perennial is a DeFi-native derivatives primitive that allows for the creation of two-sided markets that trade exposure to an underlying price feed in a capital-efficient manner. Perennial acts as a peer-to-pool derivatives automated market maker (AMM). It perpetually offers to take the other side of any taker’s position directly at the oracle price in exchange for a funding rate that floats based on utilization of the liquidity pool (similar to Compound & Aave). Perennial raised $12m, which was announced 7 December 2022. Perennial is currently not listed on any exchange.
  1. Panoptic: Panoptic is a perpetual, oracle-free options protocol built on the Ethereum blockchain. The Panoptic protocol consists of smart contracts on the Ethereum blockchain that handle the minting, trading, and market-making of perpetual put-and-call options. All smart contracts are available 24/7 and users can interact with the Panoptic protocol without the need for intermediaries like banks, brokerage firms, clearinghouses, market makers, or centralized exchanges. Panoptic is the first permissionless options protocol that overcomes the technically challenging task of implementing an options protocol on the Ethereum blockchain. Panoptic raised $4.5m which was announced 5 December 2022. Panoptic is currently not listed on any exchange.
  1. Fleek: Fleek is a platform that builds sites and applications on IPFS. Fleek offers hosting and storage services on several web3 protocols. The platform currently leverages web2 providers, such as AWS and Cloudflare, to provide these services. Fleek aims to build an interface and protocol layer to make the base layer of Web3 services accessible to users. It focuses on the content delivery market and plans to launch its own Fleek Network in 2023 and provide Web3 technologies. Fleek has a series A raise of $25m which was announced on the 1st of December 2022. Fleek is currently not listed on any exchange.
  1. WalletConnect: The communications protocol for web3, WalletConnect brings the ecosystem together by enabling wallets and apps to securely connect and interact. WalletConnect started in 2018 with the mission of connecting as many wallets to Ethereum applications as possible. Since then WalletConnect has integrated with over 100 wallets and more than 200 applications including Twitter, which has since added support for NFT-authenticated profile pictures. WalletConnect raised $12.5m which was announced on 3 November 2022. WalletConnect is currently not listed on any exchange.
  1. Arf: Arf is a global settlement banking platform that provides real-time fiat-to-fiat cross-border settlements, stablecoin-based credit lines, and global treasury management for financial institutions and licensed money service businesses (MSBs). Arf raised $13m which was announced on 26 October 2022. Arf is currently not listed on any exchange.

Total raise: $67m.

II. Polychain Capital

Polychain Capital “is the world’s premier digital asset investment fund.” Based in San Francisco, Polygon Capital actively manages global blockchain assets “to achieve exceptional returns for our investors”. According to Polygon Capital, it values “long-term vision, fierce intelligence, quantitative reasoning, and low-ego open-minded people.” Polychain’s most notable exits are Coinbase, Compound, and Altonomy.

  1. Foundation Device: Foundation builds products that make Bitcoin and decentralized technologies accessible to everyone, enabling users to reclaim their digital sovereignty. Foundation’s flagship product, Passport, a best-in-class Bitcoin hardware wallet, offers a unique combination of intuitive design, hardcore security, and a mobile-first approach with QR codes. In March 2022, Foundation launched its second-generation Passport device, which continues to gain traction and adoption among consumers with thousands of Passports sold over the last 18 months. Foundation raised $4m which was announced on 19 December 2022. Foundation Device is currently not listed on any exchange.
  1. Evertas: Evertas is a pioneer in the crypto assets and insurance space developing one of the first new risks the insurance industry has seen in decades, thus filling a critical gap in the blockchain and crypto asset industry. Evertas raised $14m which was announced 13 December 2022. Evertas is currently not listed on any exchange.
  1. T3rn: t3rn is a hosting platform for smart contracts that enables trustless, interoperable execution, and composable collaboration. T3rn has been created to offer a fresh approach to the problem of blockchain interoperability (i.e. the ability of blockchains to communicate and interact with one another). The ultimate goal of t3rn project is to enable trust-free collaboration between blockchains and harness this synergy to create an ecosystem in which anyone can utilize and deploy an interoperable smart contract—an ecosystem where developers are rightly rewarded for their contributions. The t3rn offering comes with three key characteristics:
  • Interoperability
  • Fail-safe execution
  • Composability

The t3rn protocol renders smart contracts blockchain agnostic, meaning they can instantly execute on multiple blockchains. Smart contracts can be uploaded as they are and t3rn will host and securely execute them across independent blockchains, breaking the barrier to serving users across industries and blockchain platforms. Executed smart contracts are stored in t3rn’s decentralized repository and can be used by anyone, either for free or on a pay-per-use model that rewards the developer. T3rn raised $6.5m which was announced 24 November 2022. T3rn is currently not listed on any exchange.

  1. Tharsis Lab: Tharsis Labs is the core developer of Evmos, a blockchain that allows for cross-chain transactions between Ethereum and Cosmos. Evmos is an evolution of Ethermint, a proof of concept introduced in 2016 as a way to deploy smart contracts on Tendermint in order to use proof-of-stake (PoS) for their consensus. Tharsis Lab’s solution removes the need to use less ecologically-friendly solutions like proof-of-work consensus (the one Bitcoin currently uses and Ethereum is currently moving from). Evmos started out as the open-source Ethermint library of tools for making a Cosmos blockchain that’s fully EVM compatible. It’s an environment that’s popular with developers on layer 1 blockchains because of the easy transition from Ethereum. Tharsis Lab raised $27m which was announced 2 November 2022. Tharsis Lab is currently not listed on any exchange.

Total raise: $51.5m.

III. Multicoin Capital

Multicoin Capital describes itself as “thesis driven investors that make long-term, high-conviction investments in category defining crypto companies and protocols across public and private markets”. Its portfolio includes Algorand, Bakkt, Paxos, Solana, The Graph, and the now collapsed FTX.

  1. Heroic Story: Heroic Story launched its first storytelling game, Legends of Fortunata, which enables writers to collaboratively create stories for characters in a shared world and then mint them as NFTs. The immersive game experience eliminates the pain points of playing traditional tabletop games online, with no-stress scheduling. It also comes with an exciting virtual rewards system designed to broaden the reach and appeal of tabletop role-playing games (TTRPGs) to new audiences. Legends of Fortunata is now available to play through Heroic Story’s game pass-gated platform. Heroic Story raised $6m which was announced 17 November 2022. Heroic Story is currently not listed on any exchange.
  1. Fluidity: Fluidity is a yield-generating protocol that rewards people for using their cryptocurrencies. Fluidity Money tokens (Fluid Assets) are a 1-to-1 wrapped asset that exposes holders to randomly paid rewards when they use their cryptocurrencies. Rewards are paid out according to a drawing mechanism held on each transaction of their Fluid Assets. These rewards are generated by the cumulative yield generated by the underlying asset, which is deposited and lent on money markets. 

For Senders: With Fluidity, you are rewarded for doing what you already do. Using your favorite DEX, paying back a friend, purchasing an NFT, all forms of on-chain value transfer using Fluid Assets can be yield-bearing, at no extra cost. 

For Receivers: Senders and Receivers receive the reward amount if a transaction that qualifies wins. You could earn a life-changing amount of money just for receiving payment. This creates an incentive for a counterparty to accept a Fluid Asset. Fluidity raised $1.3m?announced 29 October 2022. Fluidity is currently not listed on any exchange.

Total raise: $7.3m.

In the second part of this 3-piece series to be published next week, we will cover the major funding rounds led by Binance Labs, Andreessen Horowitz, and Fabric Ventures.

Gideon Ajose is the Founder of Cyberville Academy, a digital school that teaches crypto trading and investments. He is the author of the now popular post, To the Moon or to Goblin Town: Navigating the Murky Waters of the Crypto Space.