The Summer Slumber, The Top 10 Venture Capital Raises in August
In August 2023, 39 crypto projects raised capital from crypto venture capital, roughly the same amount that was raised in June. The total value raised was down ( from $454 million last month to $278 million this month), with a focus on Pre-Seed, Seed rounds and Series A. We take a look at the 10 most interesting newly funded projects.
According to DeFi Llama, 39 cryptocurrency projects secured funding in August. The total capital raised decreased month over month, with $278 million raised in August compared to $454 million in July, marking a 38.77% decrease. This decrease can be attributed to the summer seasonality. In August most financial institutions take off making it the slowest month of the year.
Now, let's focus on the standout performers of August. Certain projects, particularly those focusing on security and marketing, attracted significant interest and capital. In contrast, orderbook platforms found it challenging to attract the same levels of capital as before.
Let's now introduce the top ten projects that successfully raised capital in August despite market turbulence. These projects demonstrate that innovation and determination can still triumph in the face of fluctuating market dynamics. Let's explore their stories and celebrate their achievements.
Cube3 AI is a company specializing in web3 security, with a focus on real-time transaction protection. Unlike traditional security measures that rely on code audits and bug bounties, Cube3 AI uses machine learning to assess the risk of transactions and contracts. This allows them to block potential threats in real-time, ensuring uninterrupted and secure operation of smart contracts.
The company recently introduced its web3 transaction security platform, which is the first of its kind to block threats as they happen. They offer a suite of three main products. The first, called Detect, uses machine learning to identify and score risks in real-time for transactions, wallets, and smart contracts. The second, Protect, offers comprehensive security for web3 applications by blocking various types of cyber risks. The third, Manage, enables companies to actively monitor their web3 assets and receive timely alerts and reports.
Cube3 AI aims to solve a significant problem in web3 security. While existing measures focus on code security and remediation after an exploit, Cube3 AI bridges this gap with real-time transaction security. Their platform adds a crucial third layer of defense in the smart contract security stack, complementing existing methods like code audits.
Cube3 AI recently raised $8.2 million from various venture capital firms. They also emphasize community involvement and offer much of their platform for free, aiming to contribute to a safer web3 for everyone.
Spherex is a web3 security company that has developed a unique solution called SphereX-Protect to prevent exploits in smart contracts. Unlike traditional security measures that require pausing the contract or implementing circuit breakers, SphereX-Protect operates seamlessly, ensuring continuous contract operation. The solution is integrated directly into smart contracts and uses embedded modules to block exploit attempts. These modules collect and analyze transaction data in real-time, comparing it to a known baseline of legitimate behavior. If a transaction doesn't match this baseline, it's flagged as suspicious and reverted before finalization.
The company's system is designed to work on EVM blockchains and consists of two main modules: SphereXEngine and SphereXProtected. The SphereXEngine is the primary logic module that sets protection rules and analyzes data sent from the protocol's contract. SphereXProtected is an abstract contract that facilitates data collection and is utilized by SphereX clients to integrate the runtime data collection and exploit prevention mechanism into their contracts.
Founded by Eyal Meron and Oren Fine, Spherex recently secured $8 million in seed funding from investors including Aleph, Pillar VC, Fabric Ventures, Mensch Capital Partners, and angel investors. The funding will help the company further develop its security solutions and expand its reach in the web3 ecosystem. Overall, Spherex aims to provide a more resilient and trustworthy web3 environment by offering continuous, on-chain security solutions for smart contracts.
JKLabs is a web3 company that aims to change the way governance works in the crypto space. Co-founded by Sean McCaffery and David Phelps, the company believes that current governance models in decentralized finance are inefficient and often lead to conflicts among community members and investors. To address this, JKLabs has developed an on-chain platform that allows for more data-driven and transparent decision-making. The platform enables projects to run contests, hackathons, and issue grants, all while offering incentives to community members for their participation.
Unlike traditional governance platforms that weigh voting power based on the number of tokens a participant holds, JKLabs plans to use on-chain reputations to determine who should have more say in governance processes. This innovative approach aims to make governance more inclusive and effective, allowing for meaningful community participation.
The company recently raised $2 million in pre-seed funding from a variety of investors, including 1kx and Boys Club. The funds will be used to further develop their platform and transition off-chain governance models to the blockchain. JKLabs is already attracting attention from various partners, including Polygon Labs and Zapper, who are lined up to use the platform. Overall, the company is poised to tackle some of the most pressing issues in web3 governance, making it a project to watch in the evolving crypto landscape.
HypeLab is a web3 advertising network that aims to change how ads are served in the decentralized digital world. They address the challenges that companies face in reaching web3 audiences, as current solutions often rely on expensive airdrops or spammy social media channels. HypeLab offers a more scalable and efficient way to acquire users, track performance, and measure return on ad spend. Founded in part by former Google product manager Ed Weng, the company uses on-chain data to deliver highly personalized and relevant content to users
The company also provides a valuable service to publishers in the web3 space, many of whom are not advertising experts. HypeLab takes on the role of ad management, allowing these publishers to focus on developing their core products. They believe that digital advertising, which has been a sustainable revenue source in the web2 world, can also power a prosperous web3 ecosystem.
Recently, HypeLab raised $4 million in a seed funding round led by Shima Capital and Makers Fund. The funding will be used to continue innovating in the web3 advertising space and to help more than 50 companies they've already assisted in acquiring new web3 users.
ZTX is a web3 virtual world and creator platform. The company aims to leverage its existing web2 business, Zepeto, which has garnered over 400 million lifetime users, to drive the adoption of web3 technology. With strategic partnerships with brands like Gucci and Starbucks, ZTX is well-positioned to make a significant impact in the web3 space.
The company is focusing on creating a unique metaverse project that integrates digital asset creation and trading with web3 technology. They have a team of seasoned professionals from companies like Apple and Roblox, as well as experts from web3 ecosystems like Cosmos and Solana. ZTX has been actively developing its ecosystem and recently introduced a private beta test of its upcoming 3D open-world platform called Playtest. They also plan to launch a collection of unique 3D District Homes, offering benefits like special access to future events and enhanced gameplay within ZTX.
ZTX recently raised $13 million in seed funding. The funding round was led by Jump Crypto and included other investors like Collab+Currency and MZ Web3 Fund. Overall, ZTX aims to provide an infrastructure layer to creators in the web3 space, offering a distinct platform for diverse NFT projects and web3 builders. The company's unique approach and strong backing make it a promising player in the evolving web3 landscape.
FXHash is an innovative platform that allows artists to create and publish Generative Tokens on the Tezos blockchain. These tokens are unique programs that produce random outputs, resulting in one-of-a-kind pieces of art stored as NFTs. The platform aims to give generative artists a space where they can freely mint their creations without any curation. It also ensures that each token is independent, self-contained, and immutable, allowing for a more secure and transparent art ecosystem. If fxhash were to go offline, the tokens would still be accessible and viewable in owners' browsers, thanks to their hosting on the IPFS network.
Recently, FXHash secured $5 million in seed funding in a round led by 1kx.. The funding will be used to expand the team and prepare for a significant platform upgrade, including the integration of Ethereum minting. Additional investors in the round included Fabric Ventures, Bright Opportunities DAO, and Union Square Ventures, among others. Overall, fxhash is not just a platform but a community that aims to bring generative art and media to a broader audience.
JadaAI is a project that combines artificial intelligence with blockchain technology to help organizations make better decisions and scale their operations. Operating in a blockchain-based environment, the AI computations are executed across network nodes, ensuring the process is untampered, cross-verified, and efficiently allocated. Founded by Diego Torres, the project aims to be a game-changer in the AI industry by offering services that are ethical, sustainable, and possess zero-flaw precision.
JadaAI recently raised $25 million in funding from LDA Capital, boosting its valuation to $415 million. The capital will be used to expand the team and onboard new organizations. The project is currently in its incubation phase, with plans to offer private access to its Mark I Prototype Series to select early adopters. The AI being developed is a Level 3 Artificial General Intelligence (AGI), capable of self-learning and performing tasks across various industries while ensuring human safety.
Cantina is changing the way organizations approach web3 security by offering an open marketplace for blockchain security services. The platform connects companies, projects, and agencies with a wide range of security experts, from freelancers to specialized firms. By doing so, Cantina aims to solve the challenge of finding quality, vetted security talent in an efficient manner. Their reputation system allows for merit-based recognition, ensuring that the best experts stand out.
The platform offers two types of services to cater to different needs. Cantina Managed simplifies the selection process for organizations by offering a streamlined approach to finding the right security services. On the other hand, Cantina Guilds provides a more hands-on approach, allowing clients to choose from well-known firms or groups. This flexibility makes Cantina a go-to solution for web3 security, especially for smart contract audits and other blockchain-related security needs.
Cantina is on solid ground, having recently raised $7 million in funding. This brings their total capital raised to $8.5 million, providing them with the resources to further expand their platform and services.
Drip Haus is making waves in the web3 space by focusing on the growth of collectible content and social platforms that leverage blockchain technology. They aim to bridge the gap between traditional social media and the emerging world of decentralized platforms. By doing so, DripHaus is addressing the need for a more integrated and user-friendly approach to web3-based social interactions and content collection.
The company has developed a strategy to accelerate mass adoption of these web3 platforms. Their approach is designed to make it easier for users to engage with blockchain-based social networks and collect digital assets. This could include anything from digital art to unique social tokens, providing a new avenue for creators and consumers alike to interact in a more secure and transparent environment.
Drip Haus recently announced a $3 million seed funding round to fuel their growth. The round was led by Placeholder VC and co-led by 6th Man Ventures, Anagram, and Collaborative Currency. With this financial backing, DripHaus is well-positioned to scale their offerings and make a significant impact in the web3 social platform landscape.
Raleon is a Web3 engagement platform to transform the way brands, games, and dApps engage with their users. The company's latest product, Embedded Quests, aims to optimize user retention and conversion by offering a more personalized experience. The platform leverages growth analytics, Web3 Marketing Automation, and both off-chain and on-chain data to help projects understand their customer base better. This is particularly crucial in the Web3 space, where many brands struggle to use their websites or dApps as effective growth channels.
The company tackles the challenge of user engagement head-on by providing tools that allow projects to understand who their customers are, what matters to them, and how to interact with them in meaningful ways. One of their innovative solutions is Embedded Quests, a feature that integrates seamlessly into dApps without the need for coding. These quests can range from in-app engagements to on-chain tasks and even NFT ownership verification, offering a unified and personalized user experience. This stands in contrast to prevalent Web3 quests that often redirect users to external platforms, leading to a fragmented experience.
Raleon recently secured $3.8 million in seed funding. With the new funding led by Blockchange, Play Ventures, Alliance DAO, and Portal Ventures, Raleon plans to expand its team and continue building out its platform. The investment will enable the company to further personalize the user experience with Web2 and Web3 data and better understand the actual marketing ROI of their efforts.
According to DeFi Llama, 39 cryptocurrency projects secured funding in August. The total capital raised decreased month over month, with $278 million raised in August compared to $454 million in July, marking a 38.77% decrease. This decrease can be attributed to the summer seasonality. The decrease in funding can be attributed to the end of summer vacations. August is notably one of the slowest months in the financial space. We expect in September funding to be back to normal.
What can we expect in the coming month? We anticipate these trends to persist, but economic changes could induce some shifts. Global political issues and new crypto regulations could inject uncertainty into the market, potentially impacting the volume of investment and the number of deals made. Furthermore, broader economic conditions, including inflation rates, interest rates, and the performance of traditional financial markets, will also sway investor sentiment and activity in the crypto venture capital space.
Nonetheless, there's still a substantial buzz around blockchain and DeFi, and an increasing number of industries are embracing digital assets. This should keep investors engaged. Therefore, despite potential short-term volatility, the long-term prospects for cryptoinvestments remain optimistic.
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