Bessie Liu

<div id="highlights-block_6348499984aa0" class="highlights">
 <ul>
 <li>“It has grown and evolved in ways I never imagined,” Uniswap founder Hayden Adams said</li>
 <li>Uniswap Labs will be using its latest Series B raise to expand its product offerings and become financially sustainable</li>
 </ul>
 
</div>



Uniswap Labs has closed a $165 million Series B funding round, one of the <a href="https://cms.blockworks.co/uniswap-labs-reportedly-raising-over-100-million-in-new-funding/" target="_blank" rel="noreferrer noopener">largest amounts of money</a> secured by any company in decentralized finance.&nbsp;



The raise, led by Polychain Capital, brings the protocol’s total valuation to $1.66 billion, sources familiar with the matter confirmed with Blockworks. Andreessen Horowitz, Paradigm, SV Angel and Variant also participated in the round.&nbsp;



In a <a href="https://uniswap.org/blog/bringing-web3-to-everyone" target="_blank" rel="noreferrer noopener">blog post</a> published on Thursday, Uniswap founder Hayden Adams said that he could never have imagined in 2018 when he first built the protocol that it would one day support $1.2 trillion in trading volume to date.



“It has grown and evolved in ways I never imagined…and has become critical public infrastructure for exchanging digital value,” he wrote.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">1/ When I created Uniswap in 2018, it was an experiment to create an application that fully embodied the values of Ethereum. Over these 4 years, it’s grown more than I could have imagined. Today I&#39;m so excited to announce that Labs has raised $165M in Series B funding 🦄 <a href="https://t.co/jMPvBBiG8L">https://t.co/jMPvBBiG8L</a>&mdash; hayden.eth 🦄 (@haydenzadams) <a href="https://twitter.com/haydenzadams/status/1580534086950871040?ref_src=twsrc%5Etfw">October 13, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Uniswap is one of the largest decentralized crypto exchanges — with its 24-hour trading volume a little over <a href="https://defillama.com/protocol/uniswap" target="_blank" rel="noreferrer noopener">$450 million</a> at the time of writing. But its trading volume pales in comparison to those of centralized crypto exchanges such as Coinbase and Binance, which register 24-hour trading volume of over <a href="https://www.coingecko.com/en/exchanges/coinbase-exchange" target="_blank" rel="noreferrer noopener">$2 billion</a> and <a href="https://www.coingecko.com/en/exchanges/binance" target="_blank" rel="noreferrer noopener">$15 billion</a> respectively.&nbsp;



As it currently stands, the protocol is also not yet profitable — but in an interview with Fortune Magazine, Adams said the company would be using its latest Series B raise to expand its product offerings and become financially sustainable.



The Uniswap community recently <a href="https://cms.blockworks.co/uniswap-to-create-foundation/" target="_blank" rel="noreferrer noopener">voted in favor of creating the Uniswap Foundation</a>, an independent entity distinct from Uniswap Labs but part of the Uniswap ecosystem, to contribute to the protocol’s decentralized development and provide $60 million in grants to community projects over the next few years.



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">“We are thrilled to see more funding flowing into the Uniswap ecosystem, and are excited to see Labs continue to launch products that will help onboard the next billion users into web3,” Uniswap Foundation Executive Director Devin Walsh told Blockworks.</blockquote>



The DeFi protocol has also been flirting with the idea of implementing a&nbsp;<a href="https://cms.blockworks.co/uniswap-fee-switch-pilot-likely-to-go-ahead/" target="_blank" rel="noreferrer noopener">fee switch</a>, where the protocol would receive a tenth of the liquidity pool fees from three key trading pairs: the DAI-ETH 0.05% pool; ETH-USDT 0.03% pool; and USDC-ETH 1% pool — cutting into the revenue of liquidity providers.



Although Uniswap governance has already <a href="https://snapshot.org/#/uniswap/proposal/0x4dd49ee723a7e506c6c6c15c8eabc8a7057f3f0760e44ed2f475d42203c4e3e8" target="_blank" rel="noreferrer noopener">overwhelmingly voted in favor</a> of implementing the fee switch, no action has been taken since the vote. It is important to note, however, that Snapshot voting is off-chain and acts as a signaling vote rather than a binding one on-chain.&nbsp;



Murky regulatory waters and potential securities implication risks are perhaps another reason for the community’s inaction on the fee switch — according to the Howey Test, a cryptoasset will be considered a financial security if there is a monetary investment in a common enterprise with an expected profit to be derived.&nbsp;



Matt Fiebach, research analyst at Blockworks, said it will be interesting to observe how Uniswap Labs will allocate its capital and brainpower moving forward.&nbsp;



“They could choose to focus on their venture arm or build something entirely new and pivot away from the Uniswap [the] protocol, entirely,” Fiebach said.



But, he wonders: “Without the core team building a V4, can the exchange maintain its brand moat and volume dominance?”



Correction: Uniswap will receive a tenth of the liquidity pool fees from the DAI-ETH 0.05% pool; ETH-USDT 0.03% pool; and USDC-ETH 1% pool. Updated on Oct. 13 at 5:50 pm ET.



Correction: Devin Walsh is the Uniswap Foundation&#8217;s executive director, not the CEO. Updated on Oct. 14 at 9:30 am ET.



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Funding

Uniswap Labs Valued at $1.6B After $165M Funding Round

Sebastian Sinclair

<div id="highlights-block_62f993f93a87d" class="highlights">
 <ul>
 <li>Polychain Capital led a $4 million equity round in DEX builder Shipyard Software last July</li>
 <li>Shipyard is the startup behind retail investor platform Clipper and an OFAC sanctions compliance tool</li>
 </ul>
 
</div>



San Francisco-based crypto investment firm Polychain Capital is taking a decentralized cryptocurrency exchange (DEX) provider to court over an apparent equity deal gone awry.



DEX builder Shipyard Software, also based in San Francisco, raised <a href="https://www.globenewswire.com/en/news-release/2021/07/13/2262154/0/en/Shipyard-Software-Raises-21M-for-its-First-Decentralized-Exchange-Clipper.html" target="_blank" rel="noreferrer noopener">$21 million</a> last July for its retail-focused platform Clipper, built on Ethereum. Polychain led a $4 million equity round as part of Shipyard&#8217;s raise, with the remaining $17 million derived from liquidity providers contributing to the DEX&#8217;s pool. 



Alongside its DEX offerings, Shipyard markets a compliance tool for <a href="https://cms.blockworks.co/netherlands-arrests-suspected-tornado-cash-dev-days-after-us-sanctions/" target="_blank" rel="noreferrer noopener">OFAC sanctions</a>, which allows &#8220;DeFi protocols and crypto exchanges to comply with regulations and attract institutional investors.&#8221;



More than a year after its investment, Polychain claims it has never received its Shipyard Software shares, according to a recent complaint filed in Delaware court spotted by <a href="https://www.law360.com/articles/1520003" target="_blank" rel="noreferrer noopener">Law360</a>. Polychain is now seeking an order requesting Shipyard &#8220;return and issue digital assets.&#8221;



The exact assets Polychain wants returned hasn&#8217;t yet been disclosed. Blockworks reached out to Polychain and Shipyard but spokespersons weren&#8217;t immediately available.



<h3 class="wp-block-heading">Not just DEX: Polychain is a crypto hedge fund veteran</h3>



Polychain, founded in 2016 by Coinbase&#8217;s first employee Olaf Carlson-Wee, is a prolific investor in the crypto space. 



The firm has led 80 funding rounds and backed 158 blockchain startups in total, including Compound (which it successfully exited) and hacked blockchain bridge <a href="https://cms.blockworks.co/nomad-token-bridge-raided-for-190m-in-frenzied-free-for-all/" target="_blank" rel="noreferrer noopener">Nomad</a>, according to Crunchbase.



Last month, Polychain was ordered to pay crypto hedge fund firm Pantera Capital $5.5 million in fees and expenses. Pantera participated in Polychain&#8217;s 2016 seed round. 



An arbitrator had upheld the claim that Carlson-Wee breached his fiduciary duty by “diverting corporate opportunities&#8221; away from Pantera toward Polychain, <a href="https://news.bloomberglaw.com/esg/crypto-firm-polychain-must-pay-investor-5-million-court-says" target="_blank" rel="noreferrer noopener">Bloomberg Law</a> reported.



Polychain&#8217;s most recent capital deployment was with <a href="https://www.prnewswire.com/news-releases/vespene-energy-closes-4-3-million-funding-round-led-by-polychain-capital-to-pioneer-carbon-negative-bitcoin-mining-using-captured-landfill-methane-301601766.html" target="_blank" rel="noreferrer noopener">Vespene Energy</a>, a company converting landfill methane to fuel bitcoin mining.



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Polychain Capital Sues DEX Maker, Demands its Investment Back

Jacquelyn Melinek

<div id="highlights-block_6226535075d81" class="highlights">
 <ul>
 <li>The company will use the capital to grow the team and its products, including its Ethereum Virtual Machine application</li>
 <li>Espresso plans to create bridges between Ethereum and other major chains so the line between layer-1 and layer-2 can be “blurred,&#8221; its co-founder and CEO told Blockworks</li>
 </ul>
 
</div>



A scaling and privacy solution for Web3 applications, Espresso Systems, is making its debut to the public with a $32 million funding round.



“Scaling and privacy solutions are both evolving at a rapid pace, and we are excited to contribute to the progress,” Ben Fisch, co-founder and CEO at Espresso Systems, said to Blockworks.&nbsp;



The investment was led by <a href="https://greylock.com" target="_blank" rel="noreferrer noopener">Greylock Partners</a> and Electric Capital with participation from Sequoia Capital, Blockchain Capital and Slow Ventures. Other groups backing Espresso Systems include Polychain Capital, Alameda Research, Coinbase Ventures, Gemini Frontier Fund, Paxos and Terraform Labs.



Espresso is developing layer-1 blockchain infrastructure that will provide low-fee transactions through its integration of a proof-of-stake consensus protocol with a zero-knowledge (ZK) rollup mechanism, which can use ZK proofs to bundle transactions and lower resources to process them.



ZK-proof technology is among the leading candidates to scale the Ethereum blockchain through solutions such as StarkWare and zkSync. Espresso intends to keep interoperability at the core of its plans, for example, by creating bridges between Ethereum and other major chains so the line between layer-1 and layer-2 can be “blurred” and benefit from its scaling and privacy properties in the future, Fisch said.&nbsp;



The company will use the funding to grow the team and its products. Its first product to be released is an Ethereum Virtual Machine application, known as Configurable Asset Privacy for Ethereum (CAPE). It would enable creators of digital assets, such as ERC-20 tokens on Ethereum, to add a privacy-mode switch to their assets so transactions can be seen by select parties, Fisch said. 



“For example, a stablecoin provider could offer their users the option to hide their stablecoin transactions from public view in a way that still enables the provider to meet their reporting and risk management needs,” Fisch noted.



In general, scaling has already been a necessity for many Web3 applications as transaction demand has driven up prices on networks, Fisch said. But as traffic migrates to more scalable platforms that interoperate with ecosystems, such as Ethereum, fees for Web3 applications should drop, too, he added.&nbsp;



Separately, Electric Capital, one of the co-leads for Espresso’s funding round, raised a <a href="https://cms.blockworks.co/electric-capital-raises-1-billion-to-launch-crypto-venture-token-funds/" target="_blank" rel="noreferrer noopener">$1 billion fund</a> last week to invest in decentralized autonomous organizations (DAOs), non-fungible tokens (NFTs), decentralized finance (DeFi) and decentralized infrastructure and accessibility into Web3. This investment is symbolic of the venture capital firms’ commitment to the last point, as decentralized infrastructure ramps up across the crypto ecosystem. 



“Existing solutions make tradeoffs when it comes to decentralization, and we are excited to push the industry forward with an approach that achieves both low-fees as well as the properties of decentralization this industry is founded upon,” Fisch said.



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Alameda Research

Espresso Systems Launches to Public Amid a $32M Raise

<div id="highlights-block_619cf162504c7" class="highlights">
 <ul>
 <li>This was the company’s first external investment round, ORIGYN’s CEO Daniel Haudenschild told Blockworks</li>
 <li>Investors that participated in this round include Bill Ackman’s Table Management, Paris Hilton, Coinko, Polychain Capital, Vectr Ventures, Carter Reum, Div Turakhia, GD10 Ventures</li>
 </ul>
 
</div>



ORIGYN Foundation has received $20 million in a private strategic raise, which increases its valuation to $300 million, the organization said on Tuesday.&nbsp;



Investors that participated in this round include Bill Ackman’s Table Management, Paris Hilton, Coinko, Polychain Capital, Vectr Ventures, Carter Reum, Div Turakhia, GD10 Ventures and others, it said. This was the company’s first external investment round, ORIGYN’s CEO Daniel Haudenschild told Blockworks.&nbsp;



“We have some big partners lined up that will be announced in due course, but the movement of real-world valuable assets into the digital one is well underway,” Haudenschild said.&nbsp;



The one-year-old <a href="https://www.origyn.ch/en/" target="_blank" rel="noreferrer noopener">Swiss-based nonprofit</a> has a technology that “certifies and guarantees the authenticity of physical and digital items using advanced recognition and identification techniques” via computer vision, artificial intelligence and decentralized infrastructure, it said.&nbsp;



The organization has a digital certification platform that helps <a href="https://cms.blockworks.co/?s=nft" target="_blank" rel="noreferrer noopener">non-fungible token (NFT)</a> owners identify and authenticate their physical and digital items through its technology.



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">“[The system] is using AI and computer vision to identify advanced features of luxury goods and mapping that data on a fully decentralized blockchain with no cloud instances,” Haudenschild said.&nbsp;</blockquote>



The ORIGYN Foundation has a handful of products including ORIGYN Art, ORIGYN Collectibles, ORIGYN Digital Media and ORIGYN Luxury.&nbsp;



The art sector focuses on connecting physical art with NFT certificates, while the collectible sector helps users trade collectors’ items. Separately, the digital media ecosystem is for creators to build their social capital, while the luxury subdivision is for digital certification of authenticity for luxury objects, it said.&nbsp;



“ORIGYN will officially launch digital certificates across art, collectibles, digital media, and luxury goods during the first half of 2022. The foundation’s utility token, OGY, will also become publicly tradable in 2022,” Haudenschild said.&nbsp;



Funding for this round will help accelerate its mission and contribute to expanding and improving its four products, as well as fund ongoing research and development while onboarding its partners into the crypto ecosystem, the non-profit said.&nbsp;



“Bridging physical goods with digital certificates is the next evolution of NFTs,” Haudenschild said, adding, “NFTs are more than just digital images, and we’re excited to show the world what is truly possible with this technology.”



The project runs on the Internet Computer blockchain (formerly DFINITY), which is not known for NFTs. Volume data for IC is not available on NFT sales aggregator <a href="https://cryptoslam.io/" target="_blank" rel="noreferrer noopener">cryptoslam.io</a>.



This story was updated on November 24, 2021, at 12:30 pm ET to clarify that ORIGYN NFTs will not be minted on Ethereum.



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Daniel Haudenschild

Polychain Capital, Paris Hilton and Others Invest $20M in Swiss-based ORIGYN Foundation

Morgan Chittum

<div id="highlights-block_618bf89939821" class="highlights">
 <ul>
 <li>Ryan Zurrer, a former venture partner at Polychain Capital, claimed the artwork </li>
 <li>The NFT runs on Ethereum blockchain, allowing Beeple to continuously update and change the artwork for the rest of his life, according to the artist</li>
 </ul>
 
</div>



The second most expensive non-fungible token (NFT) just sold for <a href="https://twitter.com/beeple/status/1457902055679483905?s=20" target="_blank" rel="noreferrer noopener">$28.9 million</a> via Christie’s auction house on Tuesday.



Artist Beeple’s “Human One” depicts an astronaut-like figure walking in an almost seven-foot-high translucent box, <a href="https://www.christies.com/features/Beeple-gets-real-with-human-one-11940-7.aspx?cid=EM_SEM%7CACCT:ChristiesPWC%7CCMP:2021CNY1121LIVENov21BrandUS%7CAG:ArtistsGeneralPhrase%7CENGINE:GOOGLE%7CNT:SEARCH%7CRG:US%7CBANNER:%7CIMG:%7CKW:christies%20beeple%7CMT:p%7CSID:2021CNY1121?rnd=1&amp;gclid=Cj0KCQiA-K2MBhC-ARIsAMtLKRtcXnxExxj-1PS10bfJT30orWHSJHOnBmqkFTpUOE1UKba-cqRTYjcaAgDEEALw_wcB" target="_blank" rel="noreferrer noopener">describing</a> it as “the first portrait of a human born in the metaverse.” 



Elsewhere, Beeple compared “Human One” to a “subscription service,” adding that the owner is also “buying continual access to me updating this piece.” (The artwork runs on Ethereum blockchain, allowing Beeple to update and change the work.)



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">on display at <a href="https://twitter.com/ChristiesInc?ref_src=twsrc%5Etfw">@ChristiesInc</a> NYC now✨ <a href="https://t.co/Jt0DIv1Cwl">pic.twitter.com/Jt0DIv1Cwl</a>&mdash; beeple (@beeple) <a href="https://twitter.com/beeple/status/1455440514459779074?ref_src=twsrc%5Etfw">November 2, 2021</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



“While the piece was sold last night, [it] is not complete,” he said in a <a href="https://re.wired.com/c/re-wired-how-technology-is-challenging-our-notions-of-what-art-is" target="_blank" rel="noreferrer noopener">webinar</a> on Wednesday. “I&#8217;m going to keep changing the piece and keep updating the artwork over the course of the rest of my life. That is something that is very exciting to me, and I think is much more analogous to how people will appreciate art in the future.”



Ryan Zurrer, a former venture partner at Polychain Capital, <a href="https://twitter.com/kukulabanze/status/1458236032818819075?s=20" target="_blank" rel="noreferrer noopener">claimed</a> the artwork.



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">“This is how people will view art in the future as a dynamic thing. You come down in the morning, and the piece looks one way. You come home from work, and the piece looks a different way,” Beeple said. “It just continues to evolve, surprise and just adds to its beauty.” </blockquote>



Mike Winkelmann, who goes by Beeple, made <a href="https://www.christies.com/features/Monumental-collage-by-Beeple-is-first-purely-digital-artwork-NFT-to-come-to-auction-11510-7.aspx" target="_blank" rel="noreferrer noopener">headlines</a> in March of last year for selling his NFT, “The First 5000 Days” for over $69 million at the same auction house. It remains the highest-selling piece of crypto art for Christie’s. 


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