Financing Highlights | a16z leads investment in Story Protocol developer; Hack VC leads investment in Bitcoin re-staking platform SatLayer

According to BlockBeats statistics, the total number of financings last week was 20, an increase from the previous time, with a total amount of approximately US$190.62 million and an average financing amount of US$9.531 million. Among them, the infrastructure field occupies the majority, and other fields have relatively more financing, with more financing in the DeFi field and Web3.0+AI field, less in the digital asset management/payment field, the Metaverse/GameFi field, and the social/creator economy field, and no NFT/digital fashion field. The following figure shows the proportion of financing in each sector last week:

Metaverse/GameFi

In the Metaverse/GameFi field, there were 2 financings with a total amount of US$5 million, accounting for 2.62% of the total financing last week.

Soulbound

On August 20, the Web3 social game ecosystem Soulbound announced that it had completed $4 million in financing, with participation from iAngels, Animoca Brands, Big Brain Holdings, NGC Ventures, Panony, Delta Blockchain Fund, and Blocklords CEO David Johansson.

Casey Grooms, co-founder of Soulbound, said that they abandoned the DAO model (in cooperation with Saga) and transformed from Popdrip, an NFT-based sticker and social content publishing platform, to allow players, anchors and creators to earn non-transferable DRIP tokens through cooperation with the Twitch live broadcast platform.

The new funds will be used to establish game partnerships, increase social interactions, and expand anchor bounties and social tasks. It is reported that TGE is expected to be held in the second half of 2024.

Other financings in the Metaverse/GameFi field include:

On August 22, Fanton Fantasy Football, a blockchain fantasy sports platform based on the Telegram ecosystem, announced the completion of a $1 million seed round of financing from Animoca Brands, Delphi Ventures and Kenetic Capital. Hashkey x TON Accelerator, PAKA Fund and Sign VC participated in the investment, and the specific valuation information has not been disclosed.

Fanton currently mainly attracts users in the TON ecosystem through the fantasy sports platform and provides financial incentives and rewards supported by blockchain technology. The new funds are intended to be used to further expand the GameFi and blockchain sports fields.

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DeFi

A total of 3 financings were raised in the DeFi field, with a total amount of more than US$19.2 million, accounting for 10.07% of the total financing last week.

SatLayer

On August 22, Bitcoin re-staking platform SatLayer completed an $8 million Pre-Seed round of financing, led by Hack VC and Castle Island Ventures. Franklin Templeton, OKX Ventures, Mirana Ventures, Amber Group, Big Brain Holdings, CMS Holdings and others participated in the investment. Angel investors from aPriori, Custodia Bank, LayerZero, Manta Network, Magic Eden, Sui and Pendle also participated in this round of financing.

SatLayer is a Bitcoin re-mortgage platform based on Babylon. Users can re-mortgage Bitcoin and Bitcoin Liquid Staking Tokens from platforms such as Solv Protocol, Lombard, Bedrock, pStake, and PumpBTC, which are used to protect BVS. SatLayer will provide users with points rewards. When asked whether these points will be converted into SatLayer's native tokens in the future, SatLayer co-founder Luke Xie said, "We don't have a formal token plan yet. If there are details, we will announce them in the subsequent stages."

BSX

On August 22, BSX, a DeFi derivatives protocol on the Base ecosystem, raised $6.2 million in its seed and pre-seed rounds. The seed round raised $4 million, led by Blockchain Capital. Investors in both rounds included Bankless Ventures, No Limit Holdings, Cadenza Ventures, Breed VC, and Arthur Hayes' family office Maelstrom. Its angel investors include Coinbase listing director Zach Segal, Delphi founder Tommy Shaughnessy, and CoinFund investor Isaiah Washington.

BSX is a decentralized derivatives trading platform on Base that focuses on cryptocurrency perpetual contracts. BSX said it has seen more than $4 billion in trading volume since its launch in April, with revenue recently crossing the $1 million mark. With the new funding in place, BSX plans to expand beyond derivatives trading.

A spot aggregator will be launched next month, and staking and Earn products will be launched in the coming months. BSX Earn includes a lending protocol through which traders can obtain funds to trade on Base and BSX, and the second product is BSX Vaults, which will allow traders to earn rewards by depositing funds in automatically managed trading vaults. In addition, BSX also plans to launch a layer 3 network on Base to optimize the on-chain BSX order book. It will also launch its own trading game and exclusive NFT series on Telegram to attract new users to Base and BSX.

The rest of DeFi financing includes:

On August 22, the crypto lending platform Arch announced the completion of a $5 million seed round of financing, led by Morgan Creek Digital and Castle Island Ventures. At the same time, Galaxy provided it with $70 million in debt financing. Arch was founded in February 2022 by financial industry veterans Dhruv Patel and Himanshu Sahay. The company only accepts Bitcoin, Ethereum and SOL as collateral, and does not re-mortgage, but instead uses BitGo to custody collateral on behalf of customers.

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Social/Creator Economy

A total of 1 financing was raised in the social/creator economy field, and the total amount was not disclosed.

Reflection AI

On August 21, Web3 AI virtual personality social platform Reflection AI completed its seed round of financing, with participation from CGV FOF, K24 Ventures and CatcherVC.

Reflection AI aims to provide users with a decentralized, secure and highly personalized virtual social space by combining cutting-edge AI and blockchain technologies. The core advantages of Reflection AI include a unique AI computing system, a distributed computing network, and an innovative computing power token conversion mechanism. The platform supports users to create and cultivate AI virtual personalities with autonomous learning capabilities and interact deeply in the AI-driven virtual world.

In the field of AI and Web3 applications, Reflection enables enterprises and individuals to leverage AI to drive digital innovation and cultivate new business models, and its infrastructure integration enhances smart contracts, data analysis and processing for Web3 projects. Especially for startups that need advanced machine learning capabilities, Reflection's vector data blockchain library and blockchain retrieval enhancement (RAG) provide strong support.

Infrastructure

In the infrastructure sector, there were 9 financings with a total amount of over 110.92 million US dollars, accounting for 58.19% of the total financing last week.

Programmable IP (PIP) Labs

On August 21, The Block reported that Programmable IP (PIP) Labs, a developer of the intellectual property blockchain Story Protocol, completed a $80 million Series B financing, led by a16z Crypto, with participation from Polychain Capital and other investors. Angel investors include Scott Trowbridge, senior vice president and board member of Stability AI, Adrian Cheng, founder and billionaire of K11, and Cozomo de' Medici, a digital art collector.

It is reported that the company raised $54 million in Series A last year, led by a16z crypto. Jason Zhao, co-founder and chief product officer of PIP Labs, said: "There were some smaller angel investments between Series A and Series B," which brought the total financing to $140 million. In addition, according to techcrunch, citing sources, PIP Labs is currently valued at $2.25 billion.

The "intellectual property blockchain" that Story Protocol is building is a system and platform where creators can claim ownership of a piece of content and set usage parameters around that intellectual property so that others can obtain permission and use it.

Related reading: "Story Protocol looks at intellectual property on the chain"

Sorella Labs

On August 21, according to The Block, Sorella Labs, a crypto startup dedicated to solving the Ethereum MEV problem, completed a $7.5 million seed round of financing, led by Paradigm, with participation from Uniswap Ventures, Bankless Ventures, Robot Ventures and Nascent.

Sorella Labs is developing tools to solve Ethereum's Maximum Extractable Value (MEV) problem. MEV refers to the profit that a validator or bot can extract by reordering, inserting, or censoring transactions within a block. Common MEV strategies include front-running (executing transactions before others), sandwich attacks (trading before and after large transactions), and arbitrage (profiting from price differences between platforms). These actions can lead to increased costs for DeFi users and give advantages to those with more resources.

To help prevent such MEV losses, Sorella Labs is developing two tools - Brontes and Angstrom, the former of which will be launched today.

Brontes is an open source blockchain analysis tool that processes Ethereum blocks, classifies transaction behavior, and identifies MEVs through pattern matching and analysis. Ludwig Thouvenin, co-founder and CEO of Sorella Labs, described it as "an open source Etherscan with custom block analysis capabilities."

Corn

On August 20, Ethereum L2 network Corn completed a $6.7 million financing, led by Polychain Capital, with participation from Binance Labs, Framework Ventures, ABCDE, OKX Ventures, HTX, Ventures and Relayer Capital.

The project aims to enhance Bitcoin's utility and introduce new yield-generating opportunities. Corn is a new Ethereum L2 network that uses a tokenized Bitcoin as the network's gas fee and economic incentive, codenamed BTCN. Inspired by veTOKENOMICS pioneered by Curve Finance, the Corn network distributes revenue in each block and then directs it to the protocols of $CORN stakers' choice. This allows $CORN stakers to support and reward protocols that uphold the values and culture that Bitcoin and Corn represent together.

Corn went live on August 19th, and unlike most yield-generating protocols, Corn launched with no fixed yield. The yield percentage will depend primarily on the growth of the ecosystem and the number of protocol participants achieved through Corn's flywheel mechanism.

The rest of the infrastructure financing includes:

On August 20, the modular AI data processing layer DIN completed a $4 million pre-IPO financing, with participation from Manta, Moonbeam, Ankr, Maxx Capital, etc. DIN is now focusing on expanding its ecosystem through DIN Chipper Node sales to provide early access and global participation in the AI data economy. The total project financing has reached $8 million.

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On August 22, the decentralized biotech protocol BIO Protocol announced on August 20 that it had completed the first round of Genesis auction financing of US$6.22 million, exceeding the original target of approximately US$5 million. Currently, investors who participated in the first round of financing can start claiming BIO tokens, 50% of which are available immediately, and the other 50% will be unlocked linearly within one year (called vBIO).

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On August 22, vulnerability management company Nucleus Security announced the completion of a new round of financing. Dcode Capital, supported by JPMorgan Asset Management, participated in the investment. The specific amount and valuation have not been disclosed. Nucleus Security mainly provides unified vulnerability management services for organizations that need decentralized network security tools and federal organizations, supports a comprehensive overview of vulnerabilities, and simplifies the analysis, classification and remediation processes across various systems. The new funds will be used to enhance its platform capabilities.

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On August 22, Web3 oracle service provider Stork Network completed a $4 million seed round of financing, led by Lightspeed Faction, with participation from Lattice, CMS and Wintermute. The funds raised will be used to enhance its product offerings, especially Stork Perps. Stork Labs is a core contributor to Stork Network, which aims to create simpler, cheaper and more flexible on-chain data options for decentralized protocols. One of the tools the company has developed for this purpose is the open data market.

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On August 23, Web3 security and transparency platform g8keep announced the completion of $1.25 million in financing, with participation from Robot Ventures, Base Ecosystem Fund, cygaar, devops199fan and others. The new funds will be used to expand its security and transparency platform to address defects in token issuance and transactions, including correcting vulnerabilities exposed by users and ensuring a safe and reliable digital asset usage environment for users.

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On August 23, Ducat, a Bitcoin native stablecoin project on Runes, completed a $1.25 million Pre-Seed round of financing, led by UTXO Management, and participated by THE CMS, Bitcoin Startup Lab, Bitflow, X+, etc. Ducat solves the centralization problem of the stablecoin market by providing a Bitcoin native, self-custodial and permissionless smart contract system to meet the Bitcoin holders' preference for security and autonomy. The governance token DUCAT provides a stablecoin solution that combines Bitcoin's censorship resistance with decentralized native collateral.

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Digital asset management/payment

In the field of digital asset management/payment, there were 2 financings with a total amount of over 6.5 million US dollars, accounting for 3.41% of the total financing last week.

Credbull

On August 22, the on-chain private credit fund Credbull announced the completion of $5.2 million in financing. This round of financing was led by GnosisVC, and strategic investors such as Outlier Ventures, HODL Ventures, XBTO, LucidBlue Ventures, CryptoHedge, and SingularityDAO participated.

Credbull calls itself "the first licensed on-chain private credit fund protocol" and was launched on the Polygon PoS blockchain in April this year. It aims to democratize private credit real world asset (RWA) investment by connecting traditional finance and Web3. The goal of the project is to break down the barriers between traditional finance and Web3 and provide a wider range of investors with the opportunity to participate in the private credit market.

Digital asset management/payment The rest of the financing includes:

On August 22, Miami-based Bitcoin Lightning Network payment startup TMRW announced the completion of a $1.3 million Pre-Seed round of financing, led by Maple VC and participated by angel investors such as Brad Mills. TMRW mainly uses the speed and low cost of the Lightning Network and the open payment standard Universal Money Addresses built on the Lightning Network to achieve cross-border point-to-point payments through Lightspark and ZeroHash. The new funds are intended to be used to expand the US market. TMRW has now opened its iOS beta version to US users.

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Web3+AI

A total of 2 financings were raised in the Web3+AI field, with a total amount of over 16 million US dollars, accounting for 8.39% of the total financing last week. Including:

On August 20, YeagerAI, the company developing the decentralized artificial intelligence network GenLayer, has completed a $7.5 million seed round of financing, led by North Island Ventures, with participation from venture capitalists such as Node Capital, Arrington Capital, ZK Ventures, WAGMI Ventures, BlockBuilders, Arthur Hayes' family office Maelstrom, and several angel investors.

The YeagerAI team is pioneering a technical solution called "smart contracts," a blockchain-based system that uses large language models connected to the Internet to perform functions.

GenLayer also leverages artificial intelligence in its custom delegated proof-of-stake algorithm, which randomly selects a chief validator to propose an output, which is then voted on by four other validators connected to different LLMs. If the subjective output receives majority support, the transaction is processed.

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On August 23, Skyfire, founded by former Ripple executives, announced the completion of a $8.5 million seed round of financing to provide encrypted payment solutions for AI agents. Investors include USDC issuer Circle, Ripple, Gemini, and the venture capital firm of Tim Draper, a well-known Silicon Valley billionaire and Bitcoin advocate.

Skyfire has developed an open source payment system that allows autonomous AI agents to conduct various transactions on the Internet, including the purchase of data storage, creative assets, air tickets, and daily necessities. Its payment network runs on the USDC stablecoin and is currently deployed on the Polygon network, with plans to expand to other blockchains in the future.

Skyfire co-founder and CEO Amir Sarhangi said that traditional payment systems cannot meet the needs of AI, and cryptocurrencies and blockchains provide solutions for 24/7 micro-transactions, low fees and high efficiency. The company has worked with several customers, including parts manufacturers and AI infrastructure providers for Indian automotive service centers, and is in talks with multiple large language models (LLMs) to adopt USDC-based AI agent payment solutions.

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Other financing

There was 1 other financing with a total amount of US$33 million, accounting for 17.31% of the total financing last week. Including:

On August 19, Fabric Cryptography, a startup focused on developing "VPU" chips for encryption technology, completed a US$33 million Series A financing, led by Blockchain Capital and 1kx, with participation from Offchain Labs, Polygon and Matter Labs.

Fabric was founded by MIT and Stanford University dropouts Michael Gao and Tina Ju and hardware veteran Sagar Reddy. The company said the new funds will be used to "build computing chips, software and encryption algorithms."

According to the project's introduction, at the heart of Fabric's roadmap is a new processing unit called a "verifiable processing unit" (VPU), which will be specifically designed to handle encryption technology.

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