How much is VC funding slowing down? + All the Web3 news you missed this week
With the public markets falling, how much has Venture Capital funding slowed down in recent months? Matt Turck (VC at FirstMark) wrote a great piece on his blog: The great VC pullback of 2022. Matt Turck writes,
“The growth market seems effectively dead right now.” The two exceptions to this trend: Seed rounds, which are smaller and focused on companies exiting 6-10 years out, and crypto, where investors are more closely entwined with projects in the space (and are continuing to chase the hype).
If we continue to see a downturn in the markets and NFT sales flatlining, funding for crypto/Web3 companies may no longer be the exception.
Here’s the Web3 news from the past week
Ex-Google CEO Eric Schmidt says he’s invested ‘a little bit’ in crypto — but he’s more interested in the future of Web3 (CNBC)
Eric Schmidt, who led Google from 2001 to 2011, said that if he were starting his career as a software engineer today, he’d want to work on AI or Web3. “A new model [of the internet] where you as an individual [can] control your identity, and where you don’t have a centralized manager, is very powerful,” he told CNBC. Schmidt doesn’t think the economics of Web3 work just yet, but, he said, “It will.”
Coinbase NFT Marketplace Beta Sees Less Than 900 Transactions in Opening Week (Coindesk)
Coinbase launched the beta version of its NFT marketplace to a limited set of users on April 20. According to a third-party analytics firm, it’s seen fewer than 900 transactions among 650 users, with a total trade volume of 73 ETH (~$217,000). “The low usage stats can likely be attributed to the fact that Coinbase has only granted a small portion of its three-million person waitlist access to the platform,” Coindesk reports.
NFT Sales Are Flatlining (WSJ)
As interest rates rise, tamping down on investors’ willingness to make risky bets, NFT sales are suffering. According to the data site NonFungible, the daily average of NFT sales has fallen from a high of 225,000 in September to 19,000 this week — a 92% drop. The market also has a supply and demand issue: According to Chainalysis, there are now 5 NFTs for every buyer.
A DAO Just Bought A Sports Team (Front Office Sports)
After Ice Cube’s 3-on-3 basketball league started selling ownership stakes in the form of NFTs, the NFT project DeGods purchased all 25 of its highest-tier tokens, giving it a say in the team’s executive leadership and IP and licensing rights.
Mark Zuckerberg wants to spend big on the metaverse, but investors are skeptical (The Verge)
After Meta’s first quarter earnings showed declining profits and its lowest revenue growth since going public, Mark Zuckerberg told investors that the company will “slow the pace of some of our investments.” That could include its AR- and VR-focused Reality Labs division, which lost nearly $3 billion last quarter.
Snap CEO Evan Spiegel thinks the metaverse is ‘ambiguous and hypothetical’ (The Verge)
Snap is betting on the real world. Rather than investing in a virtual metaverse, it’s focused on AR tools, like its well-known selfie filters and a pair of AR glasses that are currently being tested by developers.
Asian Billionaires’ Hotel Groups Build Virtual Lands In Decentraland And The Sandbox’s Metaverse (Forbes)
Two major hotel groups — Millennium Hotels and Resorts and Regal Hotel Groups — are launching spaces in the metaverse. Millennium’s “M Social Decentraland” will open in May as a virtual gathering space that offers real-world hotel perks, while Regal is building a space in the Sandbox called “MetaGreen,” which is focused on promoting issues around sustainability.
Bored Ape NFT company raises around $285 million of crypto in virtual land sale (Reuters)
Yuga Labs, the company behind Bored Ape Yacht Club, has sold $285 million in “Otherdeeds” tokens that can be exchanged for plots of land in its forthcoming “Otherside” metaverse. The April 30 mint sold out all 55,000 Otherdeeds tokens, which were only available for purchase with Bored Ape’s ApeCoin. Sounds great for Yuga Labs, but the sale overwhelmed Ethereum’s blockchain, leaving a “record amount” of Ether destroyed and resulting in numerous failed transactions. It also caused “gas fees” — the cost associated with a transaction on Ethereum’s blockchain — to skyrocket.
Snap Is Fueling Our Selfie Obsessions With a Flying Camera (Wired)
Snap, best known for its very intangible disappearing messages, has unveiled its latest hardware product: Pixy, a $230 battery-powered selfie drone that lifts off from a person’s palm, takes a photo, and uploads it to Snapchat. A limited number of units are available to shoppers in the U.S. and France.
DeFi Lender Goldfinch Hits $100M in Loans as Crypto-to-Real World Model Picks Up Steam (The Defiant)
The Andreessen Horowitz-backed crypto loans platform Goldfinch saw its loan value hit $100M in late April, up from $1M last February. The milestone suggests that “credit protocols with real world utility are emerging as a new growth area in crypto,” according to the Defiant.
What the heck happened to SPACs? (Big Technology Podcast)
Journalist Charles Duhigg went on the Big Technology Podcast to discuss the fate of special purpose acquisition companies, which were ultra-trendy a year ago and have since taken a nosedive in popularity.
Off topic stories I found interesting
Artificial intelligence is creating a new colonial world order (MIT Technology Review)
The MIT Technology Review is publishing a series of articles on AI colonialism, investigating the ways that the sector enriches the wealthy and impoverishes the same communities that have historically been exploited by colonialism. “The AI industry does not seek to capture land as the conquistadors of the Caribbean and Latin America did, but the same desire for profit drives it to expand its reach,” Karen Hao writes in an introduction to the series.
In case you missed it - this was the most opened article from last week’s news roundup
How I Grow My Portfolio With DeFi (Nasdaq)
With a personal portfolio largely comprising Bitcoin, Keegan Francis breaks down how to use the various DeFi applications on the market, including collateralized lending and yield farming applications.
NYC Web3 Meetups
I’ve been hosting a regular series of Web3 in person get togethers in NYC. They range from small table breakfasts to larger happy hours. If you’re interested in attending or sponsoring one of these events sign up here:
Hi, I’m Andrew Chang - I created the Web3 Roundup to share what I’m learning in this space. I’ve spent my career at the forefront of the technology industry in areas such as crypto/blockchain (Former COO @ Paxos, co-founding partner of Liberty City Ventures), video and adtech. I learn by meeting with founders, investors and other thought leaders and approach Web3 with the same enthusiasm – and skepticism – I had about crypto/blockchain technologies 10 years ago.
You can connect with me on LinkedIn or Twitter (@DigitalDrex)