/ Insights
DeFi is the most useful application of blockchains. We spend a meaningful percentage of our time thinking about DeFi, and learning from the best DeFi entrepreneurs who are building the future of finance. But when most people think about blockchains, they think about value transfer. Why? Because it’s just easier to understand. Superfluid, a new protocol we just invested in, represents the biggest step forwards in value transfer since the advent of Bitcoin.
This essay assumes familiarity with Nick Szabo’s essay on Social Scalability, Vitalik Buterin’s essay on Weak Subjectivity, and Haseeb Qureshi’s essay on Why Decentralization Isn’t As Important As You Think. This essay is not a rebuttal of Szabo’s essay.
Building on the success of our first venture fund, we’re proud to announce that Multicoin Capital has raised a new $100M venture fund to back entrepreneurs building companies (equity), and protocols (tokens) in and around the crypto space. We have been investing out of this vehicle for several months already.
Today, I’m excited to announce our investment in REALY, a platform that trades the legitimacy of streetwear and other real world collectibles. Our friends at Alameda Research and SNZ Capital also participated in the round.
Helium is a new crypto economic protocol that underpins a new business model deploying and managing wireless networks at about 100x lower cost than traditional top-down telecom business models. The first wireless technology supported by Helium is LoRaWAN, a popular technology for IoT devices. Multicoin Capital co-led the Series C round in Helium Inc in 2019 along with USV.
Multicoin Capital has accumulated a large position in RUNE, the native token of THORChain, a decentralized cross-chain automated market maker (AMM). RUNE represents one of our largest public positions.
There’s a long running joke that all financial innovation can be boiled down to two things: figuring out ways to take on more leverage, and (un)bundling risk to more efficiently price assets for investors. The first major financial innovation was the separation of debt and equity back in the 1400s. This innovation unbundled risk, creating two classes of risk holders: debt (lower risk, lower returns), and equity (higher risk, higher returns).
Today I’m excited to announce that Multicoin Capital has led a $1.15 million seed round in Swivel Finance, a new decentralized protocol that enables fixed-rate lending and interest-rate derivatives. Electric Capital, CMS Holdings, Divergence Ventures, and DeFiance Capital also participated, as did several angels including Ash Egan, Stani Kulechov of Aave, Alex Pack, Imran Khan, Qiao Wang, and Thomas Klocanas.
/The DeFi Stack
Open Finance is one of Multicoin’s three Crypto Mega Theses, wherein Open Finance is a superset of DeFi. Over the past 12 months, there has been an explosion of activity in DeFi on Ethereum: there is $13.6 billion in capital participating in DeFi, up more than 20x over the last year.
I’m excited to announce Multicoin Capital’s investment in OXIO. We led OXIO’s $3.5M seed round last year, and now the company is emerging from stealth following a $12M Series A financing led by two of the top VCs in Latin America, monashees and Atlantico Capital.
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