Weekly Summary: Focus on Stablecoin Race, Web3 Funding and Millions Join Polkadot Parachains
In this week’s edition, Ripple, Sony and Agora enter the stablecoin race, Web3 funding kicks off Q2 in style and new addresses on Polkadot Parachains surge 400%.
The Stablecoin Race Heats Up
If there is one correlation we could draw between the world’s most popular investor Warren Buffett and cryptocurrency, it would be stablecoins. Buffett’s Berkshire Hathaway is one of the biggest investors in US short-term treasuries.
Berkshire Hathaway held $133 billion in US treasury bills at the end of 2023, which is about the same amount held by Tether, Circle and other stablecoin issuers given the current market capitalisation of $154.75 billion.
Stablecoins bring “calm to chaos” in the cryptocurrency industry providing a relatively stable store of value.
Thus as the crypto industry continues to woo the mainstream, the need for secure investment channels has grown, with the industry tipped to hit $2.8 trillion by 2028.
Such prospects have attracted even more players with the likes of Ripple, Sony Bank and Agora the latest to join. More on that below.
Ripple Plans to Deploy Its Stablecoin on XRP Ledger and Ethereum by the End of the Year
It will be 100% backed by the US dollar, short-term US treasuries, and other cash equivalents.
The token is aimed at enterprise customers and banking institutions.
Brad Garlinghouse, Ripple CEO: “Institutions entering this space are finding success by partnering with compliant, crypto-native players and Ripple’s track record and resiliency speaks for itself, as we launch new products and acquire companies through multiple market cycles.”
Sony Bank Tests a Stablecoin Pegged to Fiat Currencies on Polygon Blockchain.
The Japanese gaming and entertainment conglomerate’s banking arm, Sony Bank is testing a proof-of-concept to issue a stablecoin pegged to fiat currency.
The company wants to adopt the stablecoin as a method of payment across its intellectual property for gaming and sports.
Sony Bank believes it can use stablecoins to cut fees associated with payments and remittances within the group.
Agora Preps for Stablecoin Launch with $12M Seed Round led by Dragonfly
Web3 venture firms General Catalyst and Robot Ventures are also backing Nick Van Eck, Drake Evans and Joe McGrady's startup in their efforts to disrupt the stablecoin market.
To demonstrate transparency and trustworthiness, the founders have established a fund through VanEck, which will be tasked with managing Agora’s reserves.
Kyle DaCruz, director of digital assets product at VanEck: “The exciting future of stablecoins is one in which audited and transparent stablecoin reserves are standard and we are looking forward to helping Agora build that future.”
Web3 Funding Kicks Off Q2 in Style
If the Bitcoin rally wasn’t a big enough signal that crypto is back, then perhaps recent funding news will shed more light.
The journey began in the fourth quarter of 2023 but became clear that Web3 VCs were returning last quarter. March alone saw more than $1 billion in Web3 funding, according to RootData to end the quarter with a total of $2.6 billion, the same figure raised in Q4, 2023.
The second quarter of 2024 has started with a similar oomph, with Bitkraft Ventures launching a $275 million third fund focused on early-stage gaming startups, while A16z opened the third cohort of its SPEEDRUN Accelerator with $30 million for gaming. More on that below.
Bitkraft Ventures Secures $275M Funding Round to Invest in Early-Stage Gaming Projects
The fund targets projects at the Seed and Series A stages of fundraising.
Bitkraft’s founding general partner, Jens Hilgers said his company maintains the same energy on Web3 gaming, having previously backed Gods Unchained creator, Immutable.
Hilgers added: The foundational technology of Web3, which focuses on implementing a digital-first world and digital asset ownership “is advancing quickly, with gains in things such as transaction speed and lower fees.”
A16z Opens Application for Third Cohort of Its SPEEDRUN Accelerator
The program targets early-stage gaming startups including AI, VR/AR and Web3 games.
Each selected project will receive $750,000 while also gaining access to mentorship from leading gaming advisers and investors.
Andrew Chen, general partner at A16z, who oversees Games Fund One said the program will invest $30 million over the next 45 days.
Consumer-Focused Blockchain Abstraction Layer Xion Bags $25M
The fundraising attracted participation from Animoca Brands, Nomura’s Laser Digital, Multicoin, Arrington Capital, Draper Dragon, Sfermion and GoldenTree, among others.
Xion wants to remove the complexities of building highly scalable consumer-friendly apps on the blockchains.
The platform enables developers to build, launch, and scale consumer-ready Web3 products from the ground up.
Burnt Banksy, a Core Contributor to the XION network stated: “With XION, people can interact seamlessly with decentralized applications right on their phones. No seed phrases to remember or private keys to store.”
Paradigm Leads $20M Series A Round for Ellipsis Labs
Ellipsis Labs’ decentralised exchange platform Phoenix is the biggest DEX on Solana in terms of liquidity, thanks to its approach, which focuses on platform-based opportunities rather than offering extra tokens to automated market makers.
Ellipsis said it will use the funds to expand its engineering team in a bid to create “a new financial ecosystem that offers competitive financial products on top of high-throughput blockchains.”
“We think there’s a path to building DeFi products that are comparable— then significantly better—than what exists on centralized venues,” Ellipsis co-founder Eugene Chen.
More Fundraisings
Mechanism Led an $8M Seed Round for Solana-Based Interoperability Layer Zeus
The fundraising was executed via a simple agreement for future equity at a valuation of $100 million.
OKX Ventures, Animoca Ventures, Big Brain Holdings, Lemniscap and The Spartan Group also joined the round.
The company also airdropped its native token $ZEUS with an initial allocation of 167.5 million.
AI Firm Raiinmaker Closed $7.5M Seed Round Co-Led by Jump Capital and Cypher Capital
The fundraising also attracted participation from Gate.io Labs, MEXC Global, Krypital Group, Launchpool, New Tribe Capital and others.
Zeus Network’s decentralised AI training tools enable users to train AI agents and receive rewards via mobile phones.
“There’s a perfect confluence of events occurring right now with the collision of decentralised AI, a performant blockchain infrastructure and the crypto market bull run,” Raiinmaker Founder and CEO J.D. Seraphine.
On-Chain Insights
New Addresses on Polkadot Parachains Surge 400% in March
The number of new addresses on Polkadot parachains hit a monthly record in March, surging over 400% to exceed the 1.5 million mark, with Asset Hub accounting for the lion’s share of the surge with 1.3 million new addresses.
The surge was driven by tailwinds from Polkadot’s collaboration with Circle which saw stablecoin issuer list Polkadot Network among chains that host USDC.
Top fan tokens saw over $1.4B in volume over the past 30 days
Paris St Germain and FC Barcelona were among those that contributed the largest share in transaction volume.
To wrap up, this too happened
Binance NFT Marketplace is Ceasing Support for Bitcoin NFTs
The crypto exchange company said the decision was taken as part of the ongoing efforts to streamline product offerings on the Binance NFT Marketplace.
Franklin Templeton Credits Ordinals for Unlocking Innovation on Bitcoin
“Bitcoin Ordinals have seen a surge in trading volume over the past several months. This is reflected in an increase in dominance starting in December of 2023 when it surpassed ETH in trading volume,” Franklin Templeton wrote in a note to investors.