Venture capital firms are capitalizing on the current bullish market conditions. In March, Borderless Capital, a Web3-native investment company, acquired quantitative trading firm CFT Capital, expanding its business and adding artificial intelligence and proprietary trading products to its portfolio. With $600 million in assets under management, Borderless aims to enhance capital deployment efficiency across Web3 verticals.
Borderless Capital is known for its early investments in Algorand, Blockchdaemon, and Securitize. The company has also partnered with BlackRock’s tokenized digital fund through its association with Securitize. The acquisition of CFT Capital will enable Borderless to enter the Latin American market. David Garcia, co-founder and managing partner of Borderless, expressed the company’s active interest in expanding into Argentina, Uruguay, Brazil, Chile, and Mexico.
Looking ahead to 2024, Borderless expects cross-chain standardization to be the next phase in the evolution of the crypto space. The company anticipates the emergence of new L1s, L2s, and even L3s, emphasizing the need for an aggregation layer that can interoperate across any chain for mainstream adoption.
Additionally, Borderless has a strong focus on decentralized physical infrastructure (DePIN). The company believes that DePIN represents a new coordination and innovation paradigm in various industries, including communication, distributed computation, mapping, and transportation.
In this edition of Cointelegraph’s VC Roundup, several startups secured capital during the final weeks of March:
1. Morph, an Ethereum Virtual Machine (EVM) layer-2 platform, raised $20 million in angel and seed funding. The funding round was led by DragonFly Capital and included participation from Pantera Capital, Foresight Ventures, The Spartan Group, MEXC Ventures, Symbolic Capital, Public Works, MH Ventures, and Everyrealm. Morph plans to utilize the funds for talent acquisition, developer incentives, and marketing efforts. The platform is built on decentralized sequencers, optimistic zkEVM integration, and modular design, emphasizing its commitment to decentralization.
2. FLock.io, a London-based Web3 decentralized AI startup, secured a $6 million seed round co-led by Lightspeed Faction and Tagus Capital. FLock.io aims to decentralize AI agent training, fine-tuning, and inferencing while putting an end to user data collection. The company’s Federated Learning-powered Training Platform allows anyone to contribute knowledge to AI models, resulting in community-owned models with fair rewards for data contributors.
3. Keyring Network, founded by a former Nomura quant analyst and a J.P. Morgan investment banker in 2022, raised $6 million in seed funding. The funding round was co-led by gumi Cryptos Capital and Greenfield Capital, with additional support from Motier Ventures, Kima Ventures, UDHC Finance, Eberg Capital, and notable angel investors. Keyring Network leverages zero-knowledge technology to address regulatory compliance and market liquidity for financial organizations. The platform enables private data sharing and identification of qualified participants for secondary market tokenized transactions. The asset-level solution offered by Keyring Network provides flexibility in compliance, allowing users to restrict counterparty interactions based on their risk appetite.
4. Rails, a crypto perpetual exchange, raised $6.2 million in a seed round led by Slow Ventures, Round13 Capital, CMCC Global, and Quantstamp. Rails offers self-custody trading of perpetual contracts, providing traders with a risk management strategy without an expiry date. The platform utilizes smart contracts powered by zero-knowledge proofs. Rails was created following the collapse of FTX, addressing the need for a reliable and efficient trading environment.
5. BOB (Build on Bitcoin), a hybrid layer-2 solution, raised $10 million in a seed funding round led by Castle Island Ventures. Mechanism Ventures, Bankless Ventures, CMS Ventures, UTXO Management, Asymmetric, Antalpha, Web3.com Ventures, BTC Frontier Fund, and Zeeprime also contributed to the funding round. BOB aims to launch the first Bitcoin layer-2 solution with Ethereum Virtual Machine (EVM) compatibility. This compatibility will facilitate the onboarding of decentralized applications (DApps) on the Bitcoin network. BOB has formed a strategic partnership with Anduro, a project by Marathon Digital, to collaborate on Alys, a Bitcoin layer-2 solution for institutions.
6. RACE, a tokenization platform, raised $5 million to support its recently released testnet. RACE offers tokenization of various assets, including aircraft, real estate, private credits, art, jewelry, and gold, to accredited and institutional investors. The platform plans to establish Decentralized Investment Committees (DICs) composed of industry experts to perform due diligence on assets. The DICs will cover underwriting, legal services, asset custodianship, and financial analysis to ensure thorough due diligence before tokenization.
In conclusion, venture capital firms are actively investing in various sectors within the crypto space. Startups in areas such as AI, decentralized infrastructure, compliance solutions, perpetual exchanges, layer-2 solutions, and tokenization platforms have successfully raised significant funding, indicating the growing interest and potential in these areas.