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Brokerage app company Robinhood has laid off “approximately 9%” of its global staff, according to a blog post from the firm’s CEO Vlad Tenev.

In the post, Tenev cited a period of significant headcount growth that resulted in “some duplicate roles and job functions, and more layers and complexity than are optimal.”

“After carefully considering all these factors, we determined that making these reductions to Robinhood’s staff is the right decision to improve efficiency, increase our velocity, and ensure that we are responsive to the changing needs of our customers,” he wrote.

The move comes ahead of Robinhood’s Q1 2022 earnings release on Thursday. In January, when the firm reported its Q4 2021 earnings, Robinhood predicted a decline in total net revenues compared to 2021’s first quarter.

“For the first quarter of 2022, Robinhood anticipates that total net revenues will be less than $340 million, which assumes some incremental improvement in trading volumes versus what we have seen so far,” Robinhood said at the time. “At the top end, this implies a year-over-year revenue decline of 35% compared to the first quarter of 2021, during which we saw outsized revenue performance due to heightened trading activity, particularly relating to certain meme-stocks.”

Tenev said in Tuesday’s blog post that Robinhood still plans to “accelerate our product momentum through 2022 and will introduce key new products across Brokerage, Crypto, and Spending/Saving.”

Earlier this month, Robinhood announced its plan to acquire crypto startup Ziglu, and at the Bitcoin 2022 event in Miami announced the broader rollout of wallet services and a plan to support Lightning network payments.

Christine Brown, Robinhood Crypto’s chief operating officer for crypto, departed the brokerage app company in late March. 

© 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.

CXIP Labs, a protocol aiming to fix common problems in NFT minting, raised $6.5 million in seed funding to launch a new product suite for creators, developers and businesses.

The new protocol Holograph, of which CXIP Labs will be the parent company, aims to make NFT minting and bridging more intuitive and cheaper, allowing NFT creators to create new works without extensive coding knowledge and for developers to bridge NFTs between blockchains easier. 

CXIP Labs was originally founded by intellectual property lawyer Jeff Gluck and sought to protect the copyright of NFT creators. The protocol then expanded to tackle NFT issues involving verification, data impermanence, fragmented royalties and high minting cost on Ethereum. CXIP’s technology has been used to facilitate NFT drops from Sotheby’s Metaverse and Nifty Gateway. 

Courtside Ventures and Wave Financial led the seed round, with additional funding from Vaynerfund, a venture capital firm founded by entrepreneur and internet personality Gary Vaynerchuck, the musician Diplo, NFT influencer Gmoney, Nadya from Pussy Riot, NFT artist Justin Aversano, Arca NFT Fund, Infinity Ventures Crypto, Kenetic Capital, Mirana Ventures, Company Ventures, Avalaunch, Soma Capital, Kosmos VC, Palm Drive Capital and others.

In addition to the funding round, CXIP Labs adds musicians Pharrell Williams and Joe Jonas to its board of advisors. 

Last year, CXIP Labs raised a $1.7 million seed round (The Block Research’s Larry Cermak and Lars Hoffmann participated in that round as angels). 

Disclosure: Members of The Block Research may participate in equity or token sales organized by firms and projects that The Block News covers. The Block News has no knowledge of this participation before it is publicly announced, and no special consideration is given to news involving projects backed by members of 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.

Quick Take

• A user of decentralized exchange Uniswap filed a class-action lawsuit against Uniswap Labs, the startup that develops and maintains the protocol as well as its popular frontend website. 
• The complaint contends that if Uniswap Labs had registered with the SEC and met the burden of securities laws, investors would be better protected from fraudulent activity.
• Cases like this often never reach oral arguments inside a courtroom, but the case still spotlights fundamental questions about decentralized finance (DeFi) platforms that regulators have yet to address. 

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Two former Jefferies executives are launching Crossover Markets Group Inc., a crypto exchange for institutional traders.  

The exchange aims to increase the speed at which investors can trade cryptocurrencies by lower latency, which describes how long it will take for an action to be completed.

Institutional interest in this nascent space is growing, with one study by Fidelity Digital Assets showing that 7 out of ten institutional investors expect to buy or invest in cryptoassets in the near future.

The two co-founders, Brandon Mulvihill and Anthony Mazzarese, both spent five years at Jefferies, according to their LinkedIn. Mulvihill was managing director, and Global Head of FX Prime Brokerage, and Mazzarese was Global Head of FXPB Distribution. They’re working with Vlad Rysin, formerly an executive at Euronext FX, a foreign exchange trading firm, according to his LinkedIn.

“There seems to be a notion that latency doesn’t matter when it comes to trading crypto. We disagree,” said Mazzarese in a statement, reported by Bloomberg. “We polled our network of institutional relationships globally, and one of the biggest and most common requirements was reliable 24/7 technology with the same service levels and customization features they are accustomed to in other markets such as FX or equities.”

A funding round is expected in late summer or early fall 2022.

“While the vast majority of traditional institutional clients are not yet in crypto, we believe this is rapidly changing,” said Mulvihill in a statement. “As the market matures, so should the technological advancements of the exchanges.”

© 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.

Optimism, the Ethereum scaling startup, said Tuesday that it will shift to a new governance structure powered in part by a dedicated token.

The details were included in an announcement thread shared on Twitter. At the heart of the effort is what has been dubbed the Optimism Collective, which is itself comprised of two parts: a “Token House” and a “Citizens House.”

“The Citizens’ House will govern public goods funding, creating a flywheel of protocol development,” per the team’s announcement, with the Token House focused on “protocol upgrades, project incentives, and more. It drives growth.” The centerpiece of the Token House is a governance token, OP.

Optimism also stated that “[t]here’s not just one airdrop. There will be *many* airdrops.” The airdrop is “coming in Q2” per the thread, which included a post about eligibility for the airdrop as well as a link to allocations. An official date for the initial airdrop is forthcoming. 

The development comes days after social media sleuths spotted an Optimism-tied price page on crypto exchange Coinbase, fueling speculation about a token. Days later, the team said in a blog post that “[w]e’re nearing the end of a chapter and the beginning of the next — one driven by community ownership and governance. And it’s fast approaching.”

At the outset, a newly established foundation will guide the direction of the Collective. The leadership of that group includes two Optimism founders, among others.

“The newly created Optimism Foundation will serve as a steward of the Collective, running experiments, bootstrapping the ecosystem, and eventually dissolving. It will eventually defer all governance rights on-chain. This is a big step for building an ecosystem of contributors,” the announcement said. 

Optimism raised a $150 million funding round last month at a $1.65 billion valuation. Paradigm and a16z co-led the round.

© 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.

The Consumer Financial Protection Bureau is setting the stage for more involvement in the crypto industry.

On April 25, the CFPB announced that it was invoking a largely unused provision from the Dodd-Frank Act that gave birth to the bureau in the aftermath of the 2007-2008 financial crisis.

The rule gives the CFPB fairly wide authority to supervise “nonbanks” engaged in consumer-facing financial services based on potential risk. The limits of this definition are any nonbanks “whose activities the CFPB has reasonable cause to determine pose risks to consumers. This authority is not specific to any particular consumer financial product or service.”

In its announcement, the CFPB specified its interest in emerging technologies, writing: “Nonbanks do not have a bank, thrift, or credit union charter; many today operate nationally and brand themselves as ‘fintechs.'” 

In its procedural rule, the CFPB emphasized that it already has the authorities it is invoking, meaning that it does not need to wait for the usual timeframes that the Administrative Procedures Act requires: 

“The final rule is not necessary to establish the Bureau’s supervisory authority under 12 U.S.C. 5514(a)(1)(C). Rather, the final rule merely provides transparency and ensures consistency regarding the procedures that the Bureau intends to use in connection with its preexisting supervisory authority under 12 U.S.C.”

As a result, the rule will come into effect in just 30 days. When contacted by The Block, the CFPB did not specify whether it had already begun making supervisory inquiries into firms based on this rule. 

Though the release does not specifically name crypto, the CFPB’s interest in the industry has been on the rise regardless, as has interest in its involvement in crypto. In October, Senator Elizabeth Warren told Bloomberg that the CFPB should crack down on crypto, based on existing statutory authority.

In January, the bureau hired Alexis Goldstein from the antimonopoly Open Markets Institute to lead its digital asset response. Goldstein had spent much of 2021 appearing in Congressional hearings on cryptocurrencies, in which she was consistently critical of the industry. She frequently compared crypto today to Wall Street in the lead up to 2007. 

CFPB director Rohit Chopra also appeared before the Senate Banking Committee today. 

According to CFPB data, the bureau has received over 12,000 complaints related to crypto in the past year. Earlier this year, the CFPB began making inquiries into Venmo’s operations. 

© 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.

A new investment firm founded by Joe McCann has raised $1 billion in capital, joining the likes of Andreessen Horowitz (a16z), Paradigm and Katie Haun’s new set of funds in unveiling new billion dollar plus raises over the last year.

McCann — whose career has spanned systematic trading at John Burbank’s Passport Capital to strategy at Microsoft — has named the crypto market’s latest investment firm Asymmetric.

But McCann is keen on pointing out how his new company is different from the fast-growing list of capital allocators in the crypto market.  And if you asked him to describe Asymmetric, he’d likely say “technology company” before he would “investment firm.”

“We take a very technological view on crypto,” he said in an interview with The Block. “We’re a technology company with the mandate of a fund.”

McCann, to be sure, is not the only fund manager touting technological chops. a16z Crypto recently launched a fully fledged research lab to tackle some of crypto’s thorniest problems, while Paradigm is known for hiring top-tier developers to work alongside its investors. 

Still, McCann was a crypto entrepreneur prior to launching Asymmetric, having run NodeSource, which McCann described on a 2019 episode of The Scoop podcast as an open-source “engine powering software development.” He also has contributed to the code to Solana’s Anchor set of developer tools. 

“When it comes to open source tooling, this is literally what I built a business on,” he said.

‘Most forward thinking funds’

McCann has been able to convince some of the biggest names in the crypto space to back him, including a16z’s Marc Andreessen and Chris Dixon. Solana’s Anatoly Yakovenko and Raj Gokal are also investing in Asymmetric, alongside CMS’s Dan Matuszewski, FTX, Circle, and former Coinbase president Asiff Hirji. 

Kyle Samani and Tushar Jain of Multicoin are also investing. 

Other investors include Chris Cecere, a former portfolio manager at Brevan Howard, Bouchra Darawazh, a Goldman Sachs alumna who founded the jewelry company Aurate, and Brett Beller, founder of Drizly. 

“We’re excited for Circle Ventures to be an investor in Asymmetric, one of the most forward thinking funds in crypto,” noted Circle’s Jeremy Allaire. 

CMS’s Matuszewski put it more simply: “I’m long Joe.”

McCann, for his investments, however, won’t always be “irresponsibly long.” If the fund has exposure to a token via a specific token deal, it’s going to be relative pragmatic. 

“Let’s assume we get 10% token allocation and if it is up 100% out the gate, you would be irresponsible not to take out your principle. This is acting as a fiduciary as an LP.”

That’s an interesting position to take in a market where many funds rode the wave to riches on one protocol or token bet. 

Asymmetric will be split into two vehicles: a venture investment fund and a liquid one. The former will go head-to-head with the likes of Paradigm and Multicoin on securing allocation in token deals, while the former will be run somewhat akin to a Wall Street hedge fund. To that end, it will leverage Wall Street’s most complex instruments. 

“The purpose of the liquid fund will be to manage liquidity with a level of sophistication most investors don’t have,” he said.

For instance, the fund may see something like ether as undervalued. Rather than simply purchasing more ETH over-the-counter, the fund might express such a view through options. 

“If ETH rips towards $10,000 and we bought end-of-year call options, that is a way better use of tools to express that view,” he said. 

In McCann’s view, most of crypto’s venture funds and new incumbents from San Francisco’s Market Street have not leveraged these Wall Street tools. 

“TradVC typically never had to manage a liquid book. In crypto, you have to,” McCann said. “Most funds would just buy ETH.”

© 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.

Fort Worth, Texas is getting into the bitcoin mining business, in a push to present the city as a leader in crypto.

Council members unanimously voted in favor of a resolution on Tuesday to accept a donation of three bitcoin mining machines worth $2,100 from the Texas Blockchain Council.

“We have to be on the forefront of what’s possible, especially when it comes to cryptocurrency and innovation across this country,” said Mayor Mattie Parker. “This is a part of the future and many of us have to jump on board.”

The resolution declares Fort Worth a “crypto-friendly” city, looking to welcome and encourage the growth of companies.

“City Council desires for the City to be a local government sector leader and jurisdiction of choice in the Industry by welcoming and encouraging the growth of blockchain and cryptocurrency technology companies in Fort Worth,” reads the resolution.

Before the vote, one person took the microphone to oppose the plan, arguing that the council should not endorse any currency that is not the US dollar and that the council should beware of “strangers bearing gifts.”

The donation is contingent on the machines’ continued use. The resolution stipulates that “if the city permanently terminates its use of the machines for mining Bitcoin” then they would have to be returned. 

The pilot program will be revisited after the first six months, according to the resolution.

The mayor is scheduled to join a Twitter Spaces session titled “Fort Worth Mayor and Bitcoin Mining,” on Tuesday starting at 3:45 PM ET.

© 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

• Helium, which has been around since 2013, has sought to improve connectivity across electronic devices by means of a peer-to-peer (P2P) network
• After the introduction of their token, HNT, in 2019, Helium started seeing meaningful traction in their business model
• Since then, Helium has grown in adoption and boasts one of the largest decentralized networks in the blockchain space
• As a result, a handful of related projects have started entering the decentralized wireless (DeWi) space in an attempt to capture some of the market share
• DeWi is a relatively new technology, but with the accomplishments in the blockchain space thus far, it is possible that they could significantly impact certain industries today, such as telecommunications

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0x Labs, a company that provides infrastructure for businesses to build in the decentralized exchange (DEX) space, has raised a $70 million Series B led by Greylock.

Pantera, OpenSea, and Jump Capital also participated in the round, according to an announcement. 

DEXs are cryptocurrency exchanges that allow for peer-to-peer transactions to occur without the need for an intermediary, as is the case for a centralized exchange such as Coinbase or Kraken. 

0x Labs says it provides developers and businesses the ability to incorporate DEX functionality into applications. Most recently it partnered with Coinbase, who is also an investor in this round so that the company could launch its own NFT marketplace last week.

The funding will be used to integrate new chains such as Solana, expand support for its NFT swaps feature and grow its DEX aggregator product Matcha. According to The Block Research, trade volumes for Matcha reached a high of $4.86 billion in January of this year.

The news follows similar funding rounds in this space. Most recently, CoW protocol, which underlines the decentralized exchange CowSwap, raised $23 million via a token round. 

© 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.