AWeb3VC - Funding Round Up #11

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🗓️ Week of: March 11 - 18, 2023

Web3 Funding Snapshot

🚀 The Highlights

$100M was raised across 25 announced rounds

For the third week in a row, venture funding in Web3 is down. This shouldn’t be surprising, considering the banking debacle from last week, which has likely caused some VCs to take a temporary pause. Even if funding is going on, there is a good likelihood many companies are probably holding off on any announcements until the news cycle turns over. I’d imagine the rest of March to be pretty quiet.

There is a bit of good news though. Bitcoin crossed $25K last week, which is a price target we haven’t seen since June 2022. Plus, the total crypto market cap crossed $1.2T. Many are debating whether this is driven by a flight out of TradFi in light of the banking blow-up or Binance’s announced purchasing. Whatever the driver, when the crypto markets at large turn green, it usually provides a promising environment for companies building in the space. Lets hope this lasts 🤞

🏆 Largest Funding Round 

➡️ Ibanera, a digital banking and payment platform specializing in banking, cross-border payments, currency conversion, mobile banking, and merchant services, has raised $18.5M in strategic funding from Emerchantpay, a EU-based payments company. The company recently implemented a new payments architecture that utilizes blockchain technology to automate fiat on/off-ramping for Web3 businesses. The new funding will help Ibanera to further build out this technology.

Why this matters?👉 The crypto payment services provider segment has long been established, providing the necessary infrastructure and channels to onboard new users into Web3. This space has already attracted billions in funding over the past decade. However, in 2022, many companies experienced a decline in payment volumes and corresponding transaction fees, causing many providers to struggle. Most notably, Wyre winded down at the beginning of this year. Notably, in Ibanera's announcement, the latest funding round was conducted at a discounted valuation. This is also the same week where Stripe announced closed to 50% haircut in valuation via their latest Series I funding... It appears that other crypto payment service providers may encounter the same slump in valuations until payment volumes return.

😎 Noteworthy Company 

➡️ Soul Wallet is one of the first self-custodial Ethereum wallets to be built on the newly deployed ERC-4337 standard and is set to launch later this year. The aim of the wallet is to provide a more secure user experience by leveraging "account abstraction" to make it easier for users to recover their crypto if they forget or lose their private keys. The wallet also helps to reduce gas fees. The company recently announced $3 million in seed funding from investors including Struck Crypto, Game7DAO, NGC Ventures, Dispersion Capital, Alchemy, Ankr, and Signum Capital.

Why this matters?👉 ERC-4337 is a technical standard introduced by the Ethereum Foundation that allows developers to implement "account abstraction" (AA) in Ethereum wallets. AA is a feature that enables multiple smart contracts to be deployed into a wallet. One key feature is it turn allows for easier recovery of lost private keys through social recovery and reduces reliance on seed phrases. Additionally, AA allows gas fees to be paid in stablecoins and enables gas-less payments sponsored by third parties, improving the overall user experience of self-custodial wallets.

ERC-4337 is a huge leap forward for self-custodial wallets and will have a profound impact on user experience in Web3 (in a good way!). Think of this as the 2G to 3G for mobile. While Soul Wallet is the first to leverage the new standard, it is expected that many more existing and new players will enter the space in 2023.

👀Observations, Trends & Themes

➡️ Declining Valuations... Tough Times in VC

Not to sound like a continued broken record, but valuations for some of the leading startups are down, not just in Web3, but across the board. Correspondingly and as no surprise, many VC’s funds are having to now write down their positions. Tiger Global, in particular, is reported to have wrote down their venture portfolio by 33% in 2022. I’m sure a good portion of that write-down came from crypto/Web3 companies, considering they were also investors in FTX… If VC’s are seeing slumping returns, securing capital for Web3 companies is bound to be even more challenging in 2023 😓

Funding Rounds

Top 15 Rounds 

Want access to our complete dataset or propose an update? Contact: [email protected] 

All Rounds

Jungle - Seed ($6M) | Web3 gaming studio building blockchain-based games accessible to the Latin American audience: https://www.itsjungle.xyz/

Moxy - Seed ($10M) | Web3 gaming platform that enables all players to play their favorite games competitively: https://moxy.io/

DressX - Series A ($15M) | Digital fashion store that carries 3D clothing collections from brands born in the physical world and in the digital space: https://dressx.com/

Orb Network - Private Sale ($10M) | Public blockchain infrastructure set up as a separate decentralized execution layer operating between existing Layer 1/2 solutions, enhancing the capabilities of existing smart contracts: https://www.orbs.com/

Smooth Labs - Seed ($2M) | Layer 2 Blockchain and appchain middleware enabling parallel transactions execution: https://smoothlabs.org/

ALEX - Strategic ($2.5M) | Decentralized exchange (DEX) and DeFi platform for Bitcoin enabled by Stacks: https://alexgo.io/

Entre - Seed ($1.6M) | Social networking platform for tech and Web3 professionals: https://joinentre.com/

Tilia - Strategic (Not Disclosed) | All-in-one payment platform for digital economies including gaming platforms, virtual world publishers, mobile application developers and NFT providers: https://www.tilia.io/

Capsule - Seed ($500K) | Crypto wallet toolkit for transaction signing and permissioning powered by programmable Multi-Party Computation (MPC) and Secure Enclave-Managed Authorization technology: https://usecapsule.com/

KOLO.Market - Strategic (Not Disclosed) | Vertically integrated classical music NFT platform: https://www.kolo.market/

CNHC - Series A+ ($10M) | Issuer of offshore yuan-pegged stablecoin, CNH Coin: https://www.cnhc.to/

Metalink - Seed ($6M) | NFT collection, analytics, and announcements within one app: https://metalink.com/

Nuqtah - Seed (Not Disclosed) | NFT marketplace in Saudi Arabia and the licensed by the Ministry of Communications and Information Technology and the Ministry of Investment: https://itsnuqtah.com/

Ibanera - Strategic ($18.5M) | Digital banking and payments platform that uses blockchain technology to automate fiat on-ramping for Web3 platforms and apps: https://www.ibanera.com/

Staging Labs - Seed ($1.1M) | Developer of a wallet security platform; Its first app, SafeRoot focuses on securing in-flight transactions by auto-transferring digital assets from a vulnerable wallet to a backup safe: https://www.staginglabs.io/

ShowMeta - Seed ($840K) | Web3 gaming platform that connects players to their favorite Web3 games and Metaverses: https://showmeta.io/

Giga Star - Seed ($4.8M) | Platform for creators access to fan funding, engagement, and shared royalties leveraging blockchain technology: https://gigastar.io/

Soul Wallet - Seed ($3M) | Self-custodial wallet powered by ERC-4337 enabling account level abstraction: https://www.soulwallet.io/

Daniel Allan Entertainment - Seed ($1M) | Holding company for musician and Web3 artist Daniel Allan, including IP along with rights to music streaming, touring, and Web3 income: https://danielallan.mirror.xyz/

TeleportDAO - Seed ($2.5M) | Trustless and universal interoperability protocol that provides an infrastructure for developers to build cross-chain applications: https://www.teleportdao.xyz/

Gaspack - Seed (Not Disclosed) | NFT launchpad that empowers creators, artists, and brands from building their IP into NFT projects: https://www.gaspack.xyz/

Cashlink - Series A (Not Disclosed) | Asset tokenization and issuance infrastructure: https://cashlink.de/de/

LSDx Finance - Strategic ($2M) | Liquid staking yield farming protocol: https://www.lsdx.finance/

Foresight News - Seed ($2M) | Web3 vertical content and news platform focused on providing high-quality information and in-depth insights: https://en.foresightnews.pro/

Composable Corp - Seed ($1.2M) | Developer of the Blueberry Protocol, a decentralized lending and borrowing platform: https://www.blueberry.garden/

New Funds

No new funds announced this week. 

Cool Resources

And as we talk about steep discounts facing shares of Web3 companies in the secondary markets, check out Bulletin a newly launched marketplace for private shares in the world's top crypto projects & funds.

About

AWeb3VC is a source for venture funding news, emerging startups and trends across Web3. I've been closely following cryptocurrencies and digital assets since 2013 and started working in space since 2018. Now I'm on a mission to build the most extensive venture ecosystem for BUIDLERS in Web3, starting first by tracking those BUIDLERS.