VC Roundup: ‘Web5,’ Metaverse sports and Bitcoin monetization startups generate buzz

PolySign, Mash, Floor, Euler, Trinsic, KYVE and Atmos Labs headline the latest funding deals from the world of blockchain and cryptocurrency.

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A lot has happened in the Bitcoin (BTC) and cryptocurrency markets since our last edition of VC Roundup. The monumental collapse of the Terra ecosystem spilled over into other segments of the digital asset market, exposing over-leveraged traders, lending platforms and venture capital funds. In the process, Bitcoin’s price plumbed new lows, falling below the previous cycle’s peak for the first time in its history. 

Despite macro headwinds inflicting pain on the crypto markets, venture capital firms are still investing in the industry’s most promising startups. The latest edition of VC Roundup highlights funding deals for digital asset infrastructure providers, non-custodial crypto protocols, payment solutions and decentralized identity management companies.

Digital asset infrastructure provider closes $53M round

PolySign’s quest to bring institutional-level crypto custody solutions to investors has received backing from several venture capital firms. The firm recently raised $53 million in Series C financing backed by Cowen Digital, Brevan Howard, GSR and more. In addition, the company secured a $25 million credit facility from venture firm Boathouse Capital. Although PolySign didn’t specify how the funding will be allocated, the Series C was closed around the same time that the firm acquired digital asset fund administrator MG Stover.

Related: Goldman Sachs downgrades Coinbase stock to ‘sell’

Bitcoin startup raises funds to monetize creator economy

Bitcoin and Lightning Network payments platform Mash raised $6 million in seed funding in June as part of its ongoing efforts to remonetize the internet for developers and content creators. The funding round was co-led by Nic Carter’s Castle Island Ventures and Whitecap Venture Partners, with additional participation from Maple VC, Strategic Cyber Ventures, Aquanow and Spacecadet Ventures. The Mash platform allows developers and content creators to offer customers so-called “pay-as-you-enjoy” pricing options facilitated by BTC and Lightning Network.

NFT app Floor raises $8M

Nonfungible token application Floor has closed a Series A investment round valued at $8 million to advance its mission of making NFTs more accessible to mainstream users. The funding round was led by 6thMan Ventures, with additional participation from B Capital, Worklife Ventures, Collab+Currency, and others. Floor said it will use the funding to accelerate development and bring more utility to NFTs.

Euler receives major backing

Non-custodial crypto protocol Euler has closed a $32 million funding round that was led by Haun Ventures and included participation from FTX Ventures, Coinbase Ventures, Jump Crypto, Jane Street, Uniswap Labs and others. The funding will be injected into the treasury of Euler’s decentralized autonomous organization, or DAO, which is being rolled out in three phases. Euler is a decentralized finance protocol built on Ethereum that allows users to lend and borrow crypto assets.

“Web5” and decentralized identity attract VC interest

Decentralized identity protocol Trinsic recently closed an $8.5 million seed round to continue building its so-called user-controlled identity products. A spokesperson for the company said Trinsic’s products give real-world utility to Jack Dorsey’s “Web5” ambitions. A vocal critic of Web3, the former Twitter CEO announced in June that he is bypassing the third iteration of the internet in favor of “Web5”, a new Bitcoin-centric model for identity management.

Related: VC Roundup: The rise of blockchain gaming, DAO management and asset tokenization

KYVE closes $9M raise ahead of mainnet launch

Web3 archiving protocol KYVE has raised $9 million in funding ahead of a planned mainnet launch slated for the fourth quarter of 2022. The funding round, which had participation from Distributed Global, Wicklow Capital, IOSG Ventures, Blockchain Coinvestors, Huobi Incurabor and others, will be used to integrate more ecosystems into KYVE’s so-called decentralized data lake. Several blockchains currently use KYVE, including Avalanche, Zilliqa, Cosmos and Polkadot.

Atmos Labs targets Metaverse sports with seed raise

Play-to-earn developer Atmos Labs has closed an $11 million seed round to continue building Metaverse-focused sports games. The investment round was led by NFT-focused venture firm Sfermion, with additional participation from Animoca Brands, Collab+Currency, FBG Capital, CoinGecko Ventures and several others. Atmos Labs is looking to bring e-sports to a global audience by creating immersive gameplay in the Metaverse.

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