GM.
Today’s newsletter takes a slightly different approach. Over the past year, I’ve shared my exasperation with some of my industry contacts about how the crypto credit crisis has essentially decimated my entire coverage area: the structure of the crypto market. When I’m not recording podcasts, creating this newsletter, or preparing delicious Italian cuisine, I see myself as a reporter of the crypto market structure. This means covering the ups and downs of trading and lending providers, exchanges and other market participants that play a crucial role in the infrastructure of crypto’s emerging capital markets. However, over the past year my rhythm has undergone significant changes.
FTX, Genesis, Voyager and Three Arrows have all left the stage in this room. It’s been a year of significant transformation, not only for the industry, but for me as a writer. However, it has also given me the opportunity to focus on emerging, smaller players. This was really exciting. New entrepreneurs and starters in particular stand out. They are still fueled by passion and not yet exhausted by the challenges of running a business. They are generally approachable and friendly, which makes my job all the more enjoyable.
Now I’d like to take a moment to highlight some of these new companies in the industry that may one day step into the shoes of those that passed away last year.
- Ostium laboratories: Ostium Labs, a cryptocurrency startup, has raised $3.5 million in funding with support from investors such as General Catalyst, LocalGlobe, SIG and Balaji Srinivasan. The company is developing a protocol for perpetual digitalized commodity swaps, aiming to attract both traditional commodity traders and crypto-native traders looking for a more transparent and flexible alternative to conventional derivatives platforms. The platform supports trading of perpetuals linked to assets such as oil, bitcoin and currency pairs for several major currencies, with the aim of bringing real assets onto the blockchain. It has a partnership with Chaos Labs and plans to use Chainlink for pricing. Ostium Labs aims to fill a gap in the market by offering direct on-chain exposure to a broader range of asset classes.
-
JKLabs: JKLabs, a startup in the crypto space, aims to address governance issues in the decentralized finance and web3 ecosystem by offering a platform that enables on-chain decision-making and community engagement. Unlike traditional governance platforms that rely on token-based voting, JKLabs leverages on-chain reputations to determine participant influence in the governance process, enabling more meaningful and fair participation. This approach allows projects to host competitions, hackathons, and grant programs, while giving community members the opportunity to generate revenue and grow their audiences, ultimately promoting a more transparent and efficient governance model in the crypto industry. They recently raised $2 million in pre-seed funding from several investors.
-
Fractal: Fractal, a startup co-founded by Aya Kantorovich and Alex Elkrief, has raised $6 million to develop a platform aimed at improving transparency in the clearing and settlement of digital assets. The company’s goal is to prevent the kind of leveraged deals that contributed to the collapse of companies like Three Arrows Capital and FTX, allowing clients to monitor their positions in real time and limiting loan collateral to crypto blue- chip coins to limit risks. liquidity problems faced by counterparties.
-
Turnkey: Turnkey, a startup led by former Coinbase Custody executives, has secured $7.5 million in seed funding to provide a developer platform for securing and managing digital assets in the crypto industry. They aim to provide flexible, programmable solutions for wallet generation and transaction signing across various blockchain networks, addressing the increasing complexity of on-chain transactions in the crypto space. The development comes in response to growing concerns about the security of digital assets in the wake of a record year of crypto hacks totaling $3.8 billion in losses, according to Chainalysis.
- Architect: Brett Harrison, the former president of FTX.US, has secured $5 million in funding from investors including Coinbase Ventures and Circle Ventures to launch his new venture, Architect. Architect will focus on providing software trading tools for decentralized finance to cater to large investors and institutions. The company strives to create institutional-grade trading technology that simplifies access to decentralized protocols and centralized exchanges for corporations, large traders, and large individual users.
This first appeared in Frank Chaparro’s biweekly The Scoop Newsletter. Register now.