Cryptocurrency: To sit down and compose some witty observations on the health of the digital startup industry is difficult when news of Russia’s imminent invasion of Ukraine has just broken. It’s a bad day to be a supporter of representative government versus tyranny, if you ask me. More terrible news awaits us in the near future due to geopolitical clouds.
Even still, the news machine keeps going, so let’s speak about capital recycling in the cryptocurrency market to keep ourselves busy.
In a circle, it continues on and on.
With today’s more fast pace of technological innovation, corporate venture capital activity — both defensive and offensive — seems to begin sooner in the lives of organisations.
An example of this tendency is OpenSea. There are two new programmes being launched by the firm today called OpenSea Ventures and “Ecosystem Grants” that are designed to help assist web3 and NFTs producers, as well as teams and developing technologies.
OpenSea’s “leadership” and investors, including a16z, will be available to companies that receive funding from OpenSea.
In the words of The Block, “OpenSea joins a handful of crypto firms that have created their own venture units, including unicorns Alchemy and FTX.”. Note that each is a privately held company. Fast-growing blockchain companies often reinvest their surplus resources into other organisations.
Now that the days of Intel Capital are long gone, Coinbase is undoubtedly the most regarded corporate investment team, but its competitors are vying to take it on.
Is it the case, or is there anything else going on? When it comes to this, there’s a strange twist:
- a16z financed Coinbase while it was a private company.
- A board that includes Marc Andreessen and Katie Haun (who had just founded her own cryptocurrency fund) is still in place at Coinbase.
- OpenSea is backed by both Coinbase Ventures and a16z.
- To some extent, OpenSea and a16z may be working together now that they have pledged money to OpenSea’s venture capital fund.
It’s a complex web. One of a16z’s investors is also an investor in Alchemy. OpenSea leverages Alchemy technology, and it all works together. Centralization and family fraternity are in direct opposition to decentralisation, or democraticization, as is obvious.
Do you think we’ll see more internal competition if the cryptocurrency-capital race becomes less of a one-way street? How long will OpenSea want to maintain a strong relationship with Coinbase if it plans to launch its own NFT product? Suppose Coinbase wants to sell infrastructure and enters Alchemy’s market. Since Coinbase is seeing such high levels of activity, it’s hard to imagine it wouldn’t want to.
As of now, OpenSea seems like an odd choice for a company with a basic business strategy to invest in other projects before finding its exit; yet, given the rapid speed of change in the wider crypto industry, it’s possible that even organisations with simple business strategies have become investors. Wild! And a little bizarre!
I’m attempting to maintain track of the closed-network of the most prominent crypto players and their financial backers. ” Which is odd, since it seems even more centralised to me than other venture categories do. Decentralized autonomous organisations, zero-trust systems, and the like are being promoted by the same individuals who made so much money on Web 2.0, and it looks that they will continue to do so for whatever the future Web 3 turns out to be.
Alright, I’m going to go fuck off now and worry about the future of democracy and free society in general. Please pray that Russia does not attack Ukraine by Monday. Theodore