Andre Cronje’s DeFi Primitives

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Good Morning.

Token 2049 SG festivity starts next week. This is a kind reminder that the market usually dumps during conference season. Maybe… just maybe, we’ll see some cool announcements that can lift the spirits. Fingers crossed.

In Today's Email:

• What Matters: Andre Cronje’s DeFi primitives 🔢 

• Founders Highlight: Victor & Chloe of Carv 🛠️ 

• Deal Flow: Reforge’s $25M crypto fund💰️ 

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WHAT MATTERS

Andre Cronje’s New DeFi Primitives

State of play: Andre Cronje, founder of Sonic (formerly Fantom), has introduced groundbreaking DeFi primitive: the on-chain credit score, which could redefine the future of DeFi.

• In TradFi, the introduction of credit scores enabled the development of products like personal and payday loans, unlocking an $11T market.

• Cronje with Blockchain Bureau, analyzed over 500M wallets and 15M recorded loans across public blockchains.

• They've developed a simple, fully private scoring mechanism for any address, requiring no KYC or personal data.

• Cronje’s Sonic addresses key tech barriers: reducing latency to 700ms, enabling instant finality, and supporting synchronous apps.

• It simplifies onboarding with gas subsidies and native account abstraction and introduces gas monetization for additional developer revenue.

Cronje also teases 4 unreleased DeFi primitives:

• Protection markets

• LevX

• Fx*swap

• On-chain Bureau

Why it Matters: On-chain credit scores unlock the potential for products similar to personal loans, payday loans, adjustable-rate mortgages, and car leasing to exist in DeFi. Moreover, it’s a $11T market.

For builders and investors: DeFi is one PMF that the space has. Andre’s return would hopefully incinte a new wave of DeFi experimentation — which arguably got destroyed ever since the LUNA collapse.

BUILDER-INVESTOR HIGHLIGHT

Victor & Chloe of Carv

Intro: Victor Yu and Chloe Xiaoyi Gu are the co-founders of Carv, a modular data layer for gaming and AI.

Previous background: Victor founded his first startup in 2015 called CorTec Medical, which Medtronic acquired in 2016. Victor was a consultant at McKinsey and Investor at IDG Capital before Carv.

• Chloe was the founding BD & Global Strategy for DLive from 2018-2019, after her tenure at DLive she served as the CEO of DMedia Group for 2 years. Before Carv, she was the General Manager for Contentos.

The big idea: Victor and Chloe through Carv aim to revolutionise how data is used and shared, by ensuring privacy, ownership, and control are firmly in the hands of individuals, pioneering a future where data generates value for all.

Take a peek at our referral reward at the bottom of this issue. Share this newsletter and receive our list of 500 crypto VC individuals 👇

INSIGHTS

Pendle Offers BTC Yield Up to 45%

State of play: Pendle has launched new pools that provide up to 45% variable yields and fixed yields of 10% on LBTC, a Bitcoin-based token.

• These pools were created in collaboration with Lombard and the Ethereum L2 network Corn.

• Since their launch on Wednesday, the pools have attracted over $13M in deposits.

• Pendle's method splits investments into principal and yield tokens, allowing for high yields.

• Lombard's LBTC token facilitates this process, while Corn uses Bitcoin for network fees.

• Pendle's PENDLE tokens have recently risen by 11%.

Meanwhile, Coinbase has introduced cbBTC, its version of wrapped Bitcoin, on Ethereum and Base networks.

• The ERC-20 token is backed 1:1 by Bitcoin held at Coinbase, facilitating its use in DeFi applications.

• Users can convert Bitcoin to cbBTC and vice versa, with support from DEXs like Aerodrome and Curve, and lending protocols including Aave and Compound.

• Initially available to users in select regions, cbBTC will compete with the existing Wrapped Bitcoin (WBTC).

DEAL FLOWS

Reforge Raises $25M, Seeks $80M Total

Deal flows bounced slightly this week, we saw $80M+ in deals 💼 

Crypto venture fund Reforge has raised $25M of its $80M target. Founded by ex-Shima Capital senior executives Alexander Lin and Carl Hua, Reforge aims to support blockchain technology for founders and developers.

• Lin criticized the recent wave of underperforming cryptocurrencies and the rush to launch tokens for quick returns.

• Lin attributed these issues to misaligned incentives among capital allocators.

• He also questioned the feasibility of using decentralized networks to meet the high power demands of AI tools, suggesting that many investors lack a true understanding of these techs.

Deal flows in the past week:

• Vibes, $2M Angel Round

• Carrot, $500K Pre-Seed Round

• GasHawk, $1.6M Pre-Seed Round

• t1 Protocol, $2.5M Pre-Seed Round

• PIN AI, $10M Pre-Seed Round

• Ammalgam, $2.5M Seed Round

• Hyperbridge, $2.5M Seed Round

• Wingbits, $3.5M Seed Round

• Fountain, $3.5M Seed Round

• Syrupal Protocol, $3.75M $ Seed Round

• Blocksense Network, $4M Seed Round

• DRiP, $8M Seed Round

• BTA Protocol, $1.75M Series A

• Puntored, $2M Unknown Round

• CUDIS, $5M Unknown Round

• Moku, $5.35M Unknown Round

• INFINIT, $6M Unknown Round

• CASTILE, $8M Unknown Round

• Fuse, $12M Unknown Round

• Huma Finance, $38M Unknown Round

• ODOS, Undisclosed $ Series A

• OpenEden, Undisclosed $ Strategic Round

• Eigenpie, Undisclosed $ Strategic & Seed Round

• Blum, Undisclosed $ Unknown Round

• Titan Network, Undisclosed $ Unknown Round

• StakeWith.us, Undisclosed $ M&A

• Vektor, Undisclosed $ M&A

QUICK BITES

• Grayscale launches new XRP closed-end fund.

• ZKsync activates its decentralized governance system.

• Treasure DAO seeks migration from Arbitrum to ZKsync.

• Ex-FTX Ryan Salame withdraws bid to dismiss his indictment.

• Donald Trump announces launch date of World Liberty Financial.

• US authorities pressure Nigeria to release detained Binance exec.

• Swift to test solutions interlinking fiat with various tokenized assets.

• Cypherpunk Holdings goes all in on Solana, rebrands as SOL Strategies.

• Visa-funded study shows stablecoins growing US Dollar adoption overseas.

• CFTC appeals ruling that blocked its attempt to halt Kalshi’s election contracts.

• New bill proposes joint SEC-CFTC committee to shape US crypto regulations.

NOTEWORTHY READS

• Matti’s read on what do we believe?

• Decentralised’s read on trusted enclaves.

• Multicoin’s read on the great energy coordination problem.

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Disclaimer: All the information presented in this publication and its affiliates is strictly for educational purposes only. It should not be construed or taken as financial, legal, investment, or any other form of advice.