AWeb3VC - Funding Round Up #59

🗓️ Week of: Feb 11-17, 2024

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(See "Funding Rounds" section for the complete list of deals)

$147M+ was raised across 22 funding rounds in Web3. Total capital raised has remained consistent with the 2024 weekly average, holding at roughly $150M+ in total disclosed funding rounds. DeFi continues to be one of the leading segments in Web3, attracting venture investment based on deal count and representing over 25% of the total announced deals so far in 2024. Closely associated with this trend is the increasing number of token sales (both private and public), which have seen more than $500M raised since November 2023. This trend is notable, especially given the regulatory uncertainties surrounding token sales (at least within the U.S.), which have made them a relatively less desirable funding method over the last year. Most companies and projects have pursued straight equity financing or equity plus token warrants instead. However, as the broader crypto markets continue to rally in 2024, many projects appear to be rationalizing the pursuit of token rounds, which are likely to gain a larger share of deals as the year progresses.

🏆 Largest Funding Round

➡️ MetaStreet announced a $25M funding round led by angel investors. Participants included Mechanism Capital’s Andrew Kang, GMoney, MrBlock, DCF God, Dingaling, Sisyphus, Spencer, FreeLunchCapital, Jae Chung, and GoodAlexander, among others. The company did not disclose further details about the round.

MetaStreet is a liquidity protocol for digital asset credit markets. It enables holders of on-chain, illiquid assets such as NFTs and staked tokens to borrow against their assets and provides lenders with a structured, yield-bearing, tradable asset. This is accomplished through a structuring mechanism known as the Automatic Tranche Maker (ATM), a permissionless lending protocol that automatically organizes capital in a pool based on depositors' risk and return profiles. These profiles consider factors such as collateral types, loan-to-value (LTV) ratios, and term lengths. Tranches are then transformed into tradable assets through Liquid Credit Tokens (LCTs), which are liquid, composable ERC-20 tokens representing each lender's position within a pool.

The company aims to scale its protocol with a primary focus on NFT credit markets. As part of its funding announcement, MetaStreet also launched Ascend, a program designed to incentivize lenders to participate in the protocol. Many of the investors mentioned in the round are also participants in this program.

Why this matters?👉 While experiencing a downturn from its peaks in 2021-22, the NFT market still represents a market capitalization of over $10B. Much of this capital remains locked up. Solutions such as MetaStreet and Blur's Blend protocol have attempted to unlock this liquidity by enabling a more robust credit market for NFTs. While activity on these protocols have been modest, the potential for a lower macroeconomic rate environment in 2024 could lead more investors to seek higher yields in alternative markets.

😎 Noteworthy Company

➡️ Lava is a modular blockchain network focused on providing data access. The platform operates as an application-specific Layer 1 blockchain, utilizing a Proof of Stake (PoS) consensus mechanism and built on the CosmosSDK. It introduces a concept called "specs," a modular primitive that allows contributors to add support for new chains and data services permissionlessly, which currently provides access to over 30 chains. Lava initially focuses on enabling Remote Procedure Calls (RPC) and plans to expand its services to include subgraphs, oracles, and more.

Data consumers send requests to Lava’s peer-to-peer network of data providers (i.e., node operators), who join Lava to meet data demands. The protocol incentivizes providers to offer performant service and algorithmically pairs consumers with the best node available. At the same time, Lava enables data providers to monetize their existing infrastructure by reaching more developers. Currently, there are over 250 providers on Lava, including large providers such as Blockdaemon.

Recently, Lava raised $15 million in a Seed funding round co-led by Jump Capital, Hashkey Capital, and Tribe Capital. Other investors included North Island Ventures, Dispersion Capital, Alliance DAO, Node Capital, Finality Capital Partners, along with a number of angel investors.

Why this matters?👉 With the rise of modular blockchains, roll-ups, and multi-chain applications, data access is increasingly becoming a critical component for enabling developers and innovation. RPC node operators (and other blockchain data providers) provide some of the most crucial infrastructure to Web3, and in doing so, have become some of the most valuable companies within the industry (e.g., Alchemy, Blockdaemon). Lava’s novel approach to making fragmented blockchain data more accessible through a novel marketplace could potentially capitalize on a valuable aspect of the Web3 development stack.

💸 Funding Rounds

Top 15 Rounds

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All Rounds

Analog - Private Sale ($16M) | Decentralized Proof-of-Time (PoT) based protocol for communicating validated event data: https://www.analog.one/

IntentX - Strategic ($1.8M) | OTC derivatives exchange offering perpetual futures trading: https://intentx.io/

Hydro Protocol - Private Sale (Not Disclosed) | Platform for yield and liquidity strategies on the Injective Network combining Liquid Staking Derivatives (LSD) products and Real World Assets (RWA): https://hydroprotocol.finance/

Watches.io - Seed ($1.9M) | End-to-end tracking and trading ecosystem for luxury watches: https://watches.io/

Foredefi - Seed+ ($10M) | Institutional multiparty computation (MPC) based wallet and security platform tailored for DeFi: https://fordefi.com/

Mercure DAO - Private Sale ($1.5M) | Web3 marketing hub catering and network of experts offering support for public relations, influencer marketing, and community management: https://mercuredao.io/

Ultiverse - Strategic ($4M) | One-stop metaverse platform for Web3 gaming production and publishing with immersive VR-compatible virtual worlds: https://www.ultiverse.io/

Architect - Series A ($12M) | Developer of institutional-grade trading infrastructure across global digital asset markets: https://www.architect.xyz/

Overworld - Seed ($10M) | Studio and developer of a Web3 free-to-play anime-inspired role playing game (RPG) running on the Xterio ecosystem: https://www.overworld.games/

Dorsera - Seed ($1.5M) | Decentralized incident response protocol that leverages hidden security intents to contain and mitigate exploits: https://www.drosera.io/

Lava - Seed ($15M) | Modular data network of node providers focused on providing data access on any blockchain through remote procedure calls (RPCs), API's, and indexing: https://www.lavanet.xyz/

MetaStreet - Private Sale ($25M) | Liquidity protocol for digital asset credit markets including NFTs: https://metastreet.xyz/

Vatom - Series B ($10M) | Web3 customer and stakeholder engagement platform: https://www.vatom.com/

Exverse - Private Sale ($3M) | Web3 free-to-play first-person-shooters game: https://exv.io/

Concrete (aka. Blueprint Finance) - Seed ($7.5M) | Native base protocol to generate decentralized credit products and derivatives as well as the developers of Blueprint Finance: https://www.concrete.xyz/

Sphinx - Seed ($2M) | DevOps platform for automated smart contract deployments: https://www.sphinx.dev/

NodeKit - Seed+ (Not Disclosed) | Decentralized shared sequencer built into a custom layer 1 blockchain: https://www.nodekit.xyz/

Metropolis - Seed ($1.2M) | City centric virtual world and metaverse featuring digital-physical marketplace, events, and end-to-end gaming experiences: https://www.metropolisworld.io/

Helika - Series A ($8M) | Web3 product analytics application that combines on-chain and Web2 data to help Web3 brands better understand their communities, increase user acquisition and engagement, and drive overall growth: https://www.helika.io/

Witness - Seed ($3.5M) | Verification protocol for provenance and issuance of digital ownership using both on and off-chain capabilities: https://witness.co/

Ethena - Strategic ($14M) | Developer of permissionless dollar-denominated savings instruments including US dollar stablecoin and digitally native savings bond: https://www.ethena.fi/

DePHY - Seed (Not Disclosed) | All-in-one framework and off-chain network for Decentralized Physical Infrastructure Network (DePIN) applications and hardware: https://dephy.io/

New Funds

RW3 Ventures - Fund I ($60M)

🙌 Cool Resources

Artemis Terminal

🐕 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 the 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.