VC is hard: Paradigm GC & CFO Depart

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Good Morning,

Happy Labor Day to all of my fellow proletariat.

It seems like times aren’t easy even for high-level employees these days. Two Binance executives have departed the firm, and Paradigm CFO & GC are set to leave some time in September.

All this while crypto funding reaches a 2.5 year low.

In Today's Email:

• What Matters: Paradigm CFO & GC depart 🚶

• Products: Aerodrome on Base ✈️

• Charts: Bitcoin ETF, L1 activities 📊

NOTEWORTHY READS

• Our Network’s read on Layer 2s.

• James Butterfill’s read on Bitcoin in the trading doldrums.

• Amber Group’s read on alternative L1s chances to overtake Ethereum.

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WHAT MATTERS

Paradigm CFO and GC to Depart

State of play: Paradigm, one of the largest and most established crypto VC firm, is bidding farewell to its CFO, Nathan Apsel, and General Counsel, Reena Jashnani-Slusarz.

• According to an internal email obtained by The Block, both executives are scheduled to leave in the middle of September.

• Paradigm will announce a new CFO in the coming months and Katie Biber, Paradigm’s CLO, will continue to lead the legal team.

• The departure is not a head count reduction according to the source.

What’s next: Remember, venture capital firm in itself is a business too.

• When the mark of your portfolio companies doesn’t look too great, there’s not much upside for the employees of said firms.

• This is especially true for executives that aren’t original founders. Their carry percentage is not as significant, and they can easily get another job.

Our take: It’s okay to return capital to LPs. Better keep your reputation than a few more bips of the management fees.

• We’ve seen the likes of Sequoia learned from their lessons (oops FTX), by reducing their crypto fund size.

For builders and investors: Raising too much capital, both as investors or builders, is a double edge-sword.

• Investors would need to justify to their LPs how are they going to scale returns with such a massive AUMs.

• Builders would be under a much higher expectation to “multiply” the capital they have taken — often times forced to scale by burning money, even when the business might already be profitable.

Take a peek at our referral reward at the bottom of this issue. Share this newsletter and receive our list of 100 smart crypto investors' wallet addresses 👇

PRODUCTS OF THE WEEK

Aerodrome, the New DEX on Base

A new trading and liquidity marketplace on Base, Aerodrome, is a fork of Velodrome Finance, the largest DEX on Optimism in both revenue and TVL.

• The TVL on Base increased to more than $400M since the launch of Aerodrome.

• Aerodrome accounts for nearly half of the TVL on Base with $189.6M of TVL.

• Aerodrome had a slow start at launch, gathering less than $5M in liquidity in the first two days, but then it saw deposits began surging, quickly surpassing $170M within 24 hours.

Other cool products:

• Holdstation, a non-custodial wallet for EVM-compatible networks.

• Flex, the first dynamic marketplace on Starknet.

• EthQF, a decentralised crowdfunding platform on Ethereum.

• KANTALAND, a web3 music production agency.

• Oxalus, an NFT data intelligent platform.

CHARTS OF THE WEEK

Bitcoin ETFs Delayed

State of play: The SEC is opting to delay decisions on BlackRock, Fidelity, Valkyrie, Invesco, VanEck, Bitwise, and WisdomTree’s spot bitcoin ETF application.

• The delay was announced on August 31 and September 1, and the decision deadline was set for 45 days after the order.

• The deadlines vary from 16-19 October, with Bitwise’s application being the first to get the decision on 16 October.

• The order announcement came in 2 batches, with BlackRock and Fidelity’s application delay announced a day after the first announcement.

Our take: Mark your calendars for October 16th. Bloomberg still assigns a 75% chance of approval to the application, although it will most likely be delayed until 2024.

L1 Q2 2023 Overview

State of play: Ethereum, BNB, Cardano, Solana, and Tron are the top five L1 networks in Q2 2023.

• Solana has the most daily transactions among the top five with 24.3M average daily transactions.

• Tron and BNB have the most daily active addresses with 2M and 1.3M average daily active users respectively.

• BNB has the most daily new addresses with 832K new addresses on average.

• Solana has the lowest average transaction fee with a $0.0002 transaction fee on average.

Our take: Solana still has the highest transaction throughput amongst the large blockchain network, and its price has performed relatively better than other alt L1s.

• Maybe Solana will finally be able to put SBF and FTX influence in the past.

QUICK BITES & MEME

• FTX wallet activity sparks token dump fears.

• APE, APT, and OP set for $100M in token unlocks.

• HashKey launches a liquid fund with altcoin focus.

• Binance loses global head of product Mayur Kamat.

• FTX bought a yacht for former co-CEO Sam Trabucco.

• Travel Rule comes into force in the UK for crypto firms.

• Gala Games CEO sues co-founder alleging $130M theft.

• Arkham identifies 500 wallets related to Grayscale ETH Trust.

• London Stock Exchange looks to build blockchain-based trading venue.

• Former SEC Chairman says spot Bitcoin ETF approval is inevitable.

• MakerDAO considers reimplementing the protocol on a new Solana-based chain, Vitalik sells his MKR stake.

• Crypto VC funding falls for 4th consecutive month, hitting 2.5 year low.

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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.