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Investment bank Cowen is adding two crypto native executives as it expands its crypto division.

Cowen Digital LLC has hired Blockchain.com’s former head of institutional business development and a ex-Coinbase sales associate to the crypto arm, which launched in March of this year, with customers able to trade 16 tokens, including bitcoin and ether. The 100-year-old firm’s announcement comes as it develops the business and expands into “new growth areas.” 

Expect more hiring news from Cowen: The firm is actively hiring and expanding its team as it looks to build over the next five years, according to head of execution Eric Rose. 

Jackie Rose, coming from Blockchain.com, becomes a director of institutional sales, and Chase Campbell will be a vice president of digital asset sales.

The team is led by Drew Forman, who spent five years as head of equity derivatives at Cowen. Forman previously worked as a trader at JPMorgan Chase and Nomura Securities. 

The firm has been building up its infrastructure over the past few months and has partnered with Standard Custody and PolySign to provide custodial services.

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Symbolic Capital, a venture capital firm launched in May by Polygon founder Sandeep Nailwal and Cere Network founder Kenzi Wang, has raised a $50 million VC fund. 

The fund will target “pioneering web3 applications” and its limited partners — the backers of funds — include crypto protocols, exchanges, auditing firms, and crypto vendors, and traditional LPs such as family offices and institutions, according to an announcement Thursday. 

“We’re specifically focused on supporting founders from emerging markets that have often been passed over by traditional VC. Starting Polygon in India, we struggled to get connected to VCs that believed in our vision and abilities as founders,” said Nailwal in a statement. “Our mission with Symbolic is to empower the next generation of emerging founders who have historically been overlooked by the VC industry.”

It says that it will also aim to differentiate itself by utilizing a data platform to support its portfolio companies and guide its upcoming investments. The data engine will track metrics such as GitHub contributions, social media traction and token performance, and recruiting information such as employee migration trends and job histories. 

“Our data platform will provide a leg up on the rest of the market,” claimed Nailwal. 

Launched only three months ago, the firm has already invested in the gaming company Blinkmoon, play-to-earn chase game Planet Mojo and crypto asset management company Arcana. However, this announcement marks its first formalized fund launch.

Blockchain/crypto venture funding by quarter. Image: The Block Research.

While venture capital investment in crypto startups declined in the second quarter of this year by 22% according to The Block Research, Symbolic Capital’s fund launch follows some of the sector’s biggest players’ continued push to raise more capital. 

Earlier this month, web3 investment firm CoinFund launched a $300 million fund. This year has also seen Lightspeed Ventures raise over $7 billion along with launching a crypto-native fund and a16z announce a $4.5 billion fund for crypto and blockchain startups amid a tough market for crypto startups looking to raise cash. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Quick Take

• The market capitalization of the top 50 GameFi tokens declined by over 60% between January and August 2022, roughly equivalent to the decrease in the market capitalization of the top 50 DeFi tokens.
• As of August 18, 2022, there are 1,575 GameFi projects. 40% of these games exist on BNB Chain, 26% on Ethereum, and 15% on Polygon.
• Many games are pivoting towards the free-to-play (F2P) model to lower the high entry barrier of the current iteration of GameFi. However, the sustainability of token economics remains unsolved in both premium and F2P game models.
• Alien Worlds, Axie Infinity, Solitaire Blitz, Splinterlands, and Upland, are the 5 most popular blockchain-based games based on daily active addresses.

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Alchemy, a web3 infrastructure platform backed by the likes of a16z, Coatue and Lightspeed Ventures, has announced its first acquisition, acquiring Ethereum developer education platform ChainShot. 

ChainShot offers live and instructor-led Ethereum developer boot camps, according to a statement shared with The Block Thursday. The deal will allow Alchemy to build upon its education offerings which include its Web3 University. 

“As for next steps, our goal is to make the integration of ChainShot’s programs and ours as smooth and seamless for students as possible,” said the statement. “We’re still ironing out how the pieces will come together, but one thing is certain: all of ChainShot’s course content that previously cost upwards of $3,000 will be 100% free.” 

Founded in 2017 by Nikil Viswanathan and Joe Lau, Alchemy’s business model relies on offering application programming interfaces, or APIs, to companies looking to build out their blockchain services. These include APIs for node infrastructure, transaction history and NFT functionality among other use cases. 

APIs allow businesses to more simply access each others’ systems and Alchemy’s have been used historically by crypto-native firms such as OpenSea, Dapper Labs, and Axie Infinity. Recently it has onboarded newcomers to the crypto space such as Meta, Shopify and Adobe as interest in web3 swelled. In the last few months, it’s added Solana and Polkadot integration, amplifying its plethora of compatible blockchains. 

Blockchain M&A transactions and dollar volume by year. Image: The Block Research

Despite the recent gyrations, crypto M&A deals continue to be on pace for a record year, according to a Q2 report from The Block Research. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Thailand’s oldest bank, Siam Commercial Bank, announced on Thursday it is abandoning its $500 million deal to acquire Thailand crypto exchange Bitkub, according to a press release. 

The cancellation of the acquisition comes only a month after the Thai Securities and Exchange commission ordered Bitkub to review its listing process of KUB coin on its exchange. 

SCB said the crypto startup needed time to fix regulatory issues, per the release. 

The bank planned to acquire 51% of Bitkub for around $500 million as part of building out its digital strategy.  

The deal was announced in November and was expected to be completed by the first quarter of this year, pending regulatory approval. 

This isn’t the bank’s first push into crypto. It already operates a venture capital unit called SCB 10X that invests in blockchain and decentralized finance (DeFi) startups.

“Bitkub is currently in the process of resolving various issues as per the recommendations and orders of the Securities and Exchange Commission, Thailand, which are uncertain in terms of time frame in resolving those issues,” SCB said in the release. 

“As a result, the buyer and the seller have agreed to terminate the transaction,” it added. 

SCB emphasized it remains committed to implementing the strategic plan to enter the blockchain technology and digital asset business in the release. 

The Block Research’s recent report shows that M&A transactions are on pace for a record year. But several big deals, such as Galaxy Digital’s acquisition of BitGo and PrimeBlock’s merger with SPAC 10X Capital Venture Acquisition Corp II have fallen through. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Bitcoin Depot, an Atlanta-based crypto ATM company, is set to go public via a special acquisition vehicle at an $885 million valuation, according to a Wall Street Journal report. 

Founded in 2016, Bitcoin Depot claims to be the largest provider of such ATMs in North America with more than 7,000 kiosks in the region. These ATMs function by connecting with a wallet and, after a verification process, allow the user to insert fiat money to receive BTC, LTC or ETH in their wallets. 

Bitcoin Depot CEO Brandon Mintz told the Wall Street Journal that it has continued to grow despite the bear market and is looking to target acquisitions after going public. 

The company will combine with the special acquisition company GSR II Meteora Acquisition Corp, officials at the company told the Wall Street Journal Thursday. A special purpose acquisition company, or a SPAC, is a publicly traded company created for the purpose of acquiring or merging with an existing company. 

The merger will see the Bitcoin Depot valued at $885 million amid a challenging market for not only SPACs but also crypto companies looking to make acquisitions or merge.

Last week, crypto and stocks investment company Robinhood more than halved its acquisition offer for UK fintech Ziglu amid a period of turbulence in crypto M&A markets. This followed news on the same week that investment firm Galaxy Digital had terminated its acquisition of crypto custodian BitGo and crypto miner Prime Blockchain and 10X SPAC canceled its $1.25 billion merger deal. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Katie Haun’s Haun Ventures has led a $24 million round into Thirdweb, a platform that aims to make it easier for developers to create web3 apps, at a $160 million valuation. 

Coinbase Ventures, Shopify, Protocol Labs, Polygon, Shrug VC and billionaire Joseph Lacob also participated in the round, which closed last month, according to an announcement Thursday. The company was founded by Bebo founder Furqan Rydhan and entrepreneur Steven Bartlett of Dragon’s Den UK. 

Thirdweb offers pre-built smart contracts to create products ranging from NFT drops to a  marketplace, software development kits (SDKs) to build products from the ground up and a dashboard for developer teams to track and manage on-chain contracts. The company says that the products it offers are fully non-custodial and on-chain. 

“As a developer, when you’re thinking about web3, the first problem is everything is different than I have learned previously… if I want to create a token or an NFT or a wallet, how do I get started?,” said Furqan Rydhan in an interview with The Block. “Smart contracts are also a lot more sensitive than developing for traditional internet software where ‘move fast, ship fast and break things’ was the developer motto — a mistake on the blockchain could cost you $100 million.” 

While Thirdweb counts web3 entities — DAOs, multi-sig wallets and on-chain teams — brands such as New York Fashion Week and Afterpay are also using its services to build web3 services such as NFT-gated membership clubs and tickets, virtual metaverse-like worlds with the aim of increasing fan engagement. 

Rydhan also cited a car company that is currently using its products to build an NFT waiting list for its new model release. 

Currently, its services are available on the Ethereum, Avalanche and Fantom blockchains, however, it’s currently readying Solana integration with a tentative launch date of end of September. It plans to use the funding to add further blockchains such as Cosmos, Near and Flow. 

Rydhan also claimed that with this raise the company now has over three years of runway with 60-70% still left over from its seed raise $5 million back in December of last year. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Nvidia confirmed that its second-quarter earnings missed its outlook, largely driven by a double-digit decline in gaming revenues. 

“We are navigating our supply chain transitions in a challenging macro environment and we will get through this,” Nvidia CEO and founder Jensen Huang said in a statement regarding the computing hardware company’s second-quarter earnings for the 2023 fiscal year.

Nvidia’s gaming revenues were down 33% year-over-year, totaling $2.04 billion. That represents a 44% decline from the first quarter.

The company’s gaming segment faced “challenging market conditions” in the second quarter, Nvidia Chief Financial Officer Colette Kress told investors on an earnings call today. While Nvidia had been expecting a decline in gaming revenue since May due to factors such as the war in Ukraine and COVID-19 lockdowns in China, Kress said the drop was “sharper than anticipated” and that “macroeconomic headwinds across the world drove a sudden slowdown in consumer demand.” 

“As noted last quarter, we had expected cryptocurrency mining to make a diminishing contribution to gaming demand; we are unable to accurately quantify the extent to which reduced crypto mining contributed to the decline in gaming demand,” Kress said on the call.  

Nvidia reported overall second-quarter revenues of $6.7 billion, up 3% from the same period a year earlier. Its net income was $656 million, down 72% year-over-year. 

That $6.7 billion revenue figure matches the estimate Nvidia provided in a preliminary earnings update on August 8, when it warned the market that it was expecting a $1.4 billion revenue shortfall for the second quarter compared with its outlook of $8.1 billion. 

Nvidia also saw a 4% decline in its second-quarter revenues for its professional visualization segment compared with the previous-year period. This segment includes Nvidia’s metaverse projects, which include a partnership with Siemens aimed at developing an “industrial metaverse” for the manufacturing industry. The company also recently unveiled new technologies related to the metaverse, such as new services to help developers create avatars.

Nvidia also plans to announce “breakthroughs” in the metaverse and artificial intelligence at its GTC conference, scheduled for  September 19-22, Huang said in a statement. 

Nvidia is expecting revenue declines in the gaming and professional visualization segments to continue in the third quarter, and forecasts third-quarter company revenues to be within 2% of $5.9 billion. 

“Gaming and professional visualization revenue are expected to decline sequentially, as OEMs [original equipment manufacturers] and channel partners reduce inventory levels to align with current levels of demand and prepare for Nvidia’s new product generation,” the chip company said. 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Quick Take

• Bitcoin miner Argo updated its end-of-the-year hash rate guidance from 5.5 to 3.2 EH/s.
• The company also reported a pre-tax loss of £36.9 million ($44.9 million) in the first half of 2022.

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Coinbase will launch its own liquid staking token, called cbETH, which users can get in exchange for ETH that Coinbase will stake on the proof-of-stake version of Ethereum. 

The exchange revealed cbETH, which stands for Coinbase Wrapped Staked ETH, in a tweet on Wednesday and released a detailed white paper explaining the rationale. Users will be able to transfer for cbETH as early as August 25 at 12:00 p.m. EST, provided that necessary liquidity conditions are met.  

Ethereum’s switch from proof-of-work to proof-of-stake consensus, known as The Merge, is on track to begin September 6. 

The new token will let Coinbase users engage in so-called liquid staking. On Ethereum, staking requires users to lock their ETH. That staked ETH is then utilized for establishing consensus, validating transactions, and securing the network. While those tokens are locked up, they cannot be traded. Liquid staking is a way around this.

Since it is already possible to stake ETH, services like Lido have arisen to let users exchange ETH for a derivative token that can be used in DeFi protocols. Lido’s version is called stETH.  

Coinbase’s white paper for cbETH highlighted current issues in the liquid staking market that it says may pose a danger to Ethereum. Thus far, liquid staking has been dominated by Lido, which maintains approximately a 90% market share.  

 
   
A byproduct of dominating the liquid staking market is that Lido also now accounts for more than 30% of the staked ETH. One protocol having such a large share “is untenable when it comes to consensus-bearing systems like Ethereum,” the Coinbase white paper said. It added that “there are consensus thresholds that should act as soft limits to any one solution.”  

A breach of a consensus threshold would introduce significant risks to Ethereum’s security.  

“Today the liquid staking market on Ethereum is dominated by a single solution that is on the verge of breaching 33% network penetration (the first consensus threshold),” Coinbase wrote in the white paper. “Therefore, it is necessary for the liquid staking market to have strong, competing solutions with differentiated qualities.” 

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.