Top 10 crypto projects that raised venture capital in January

Introduction

Crypto fundraising has finally started to pick up again. At the tail end of what was an excellent year for crypto price-wise, venture investors have regained their risk appetite.

In January 2024, roughly $603 billion was raised by crypto startups across 122 unique rounds. While a decrease compared to December, January is historically a slow month for fundraising as most companies only return to the office in the second half of the month.

There were a few crypto sectors that stood out. The Bitcoin Economy, which comprises blockchains and DeFi projects for the leading cryptocurrency, has garnered significant attention, resulting in numerous funding rounds for Bitcoin Economy projects. The merger of AI and Crypto also stood out as one of the most funded (and exciting) categories. Finally, gaming, decentralized infrastructure and restaking were popular sectors this month. Without further ado, let's take a look at the 10 most interesting projects that raised capital in January 2024.

Nubit

Nubit (website), a project developed by Riema Labs, has successfully secured angel funding by the founders of Bounce Finance, Domo Data and more, to further its mission of enhancing the Bitcoin ecosystem. Nubit represents a pioneering effort as the first Bitcoin-native data availability layer, aimed at significantly reducing transaction costs on the Bitcoin network.

The essence of Nubit lies in its unique approach to processing transactions. It introduces a novel standard, BRC-1310, and utilizes several advanced techniques such as Bitcoin-native staking, data availability sampling, attestation of data directly on the Bitcoin network, and a decentralized bridge. These innovations are designed to minimize trust requirements, drastically increase data throughput, reduce storage costs by up to 99%, and improve accessibility to data. This makes it possible to support a wider array of data types and applications on the Bitcoin network.

The funding Nubit has received will bring this ambitious project to fruition. The team plans to use the investment to launch the Nubit product, focusing on integrating it within the Bitcoin ecosystem to ensure seamless operation. The goal is to optimize transaction costs, which could pave the way for broader adoption of Bitcoin by making it more economical to use.

Bitfinity

Bitfinity (website), a Bitcoin Layer 2 network leveraging the Internet Computer protocol, successfully raised $7 million in total funding. This capital was raised through token rounds, with notable investors including Polychain Capital, ParaFi Capital, Warburg Serres, Dokia Capital, and Draft Ventures. The funding was gathered in two phases: an initial seed round of approximately $1 million in 2021 and a subsequent growth round that brought Bitfinity's valuation to $130 million.

Bitfinity is designed as a Bitcoin scaling solution built on the Internet Computer protocol, distinguishing itself by being Ethereum Virtual Machine (EVM)-compatible. This compatibility allows Ethereum developers to create Bitcoin-enabled decentralized applications on Bitfinity's network. The platform is set to offer substantial benefits, such as handling Bitcoin Ordinals and BRC-20 tokens, alongside EVM assets. Bitfinity promises to deliver dApp deployment capabilities that are 100 times faster than Ethereum's, at a significantly reduced cost.

The primary use of the funding is to support the imminent launch of Bitfinity's mainnet, which is currently in the testnet phase. The mainnet launch is anticipated to occur either later this month or early the following month. This move aims to generate excitement and prepare the ground for Bitfinity's integration into the broader Bitcoin and Ethereum ecosystems.

Bitfinity's ecosystem is already attracting interest from several decentralized applications, including Sonic (a decentralized exchange), Synthetix (a derivatives liquidity protocol), and Liquity (a decentralized borrowing protocol), which are either already building on Bitfinity or planning to do so.

SkyArk Chronicles

Skyarc Studios (website), the developer behind the anime-style fantasy game Skyark Chronicles, successfully raised $15 million in funding, initially reported to be led by Binance Labs, the venture capital arm of the cryptocurrency exchange Binance. However, it was later clarified by Binance Labs that their investment in Skyarc Studios was actually made in 2021 as part of an incubation program and was not part of the recent $15 million funding round as previously misrepresented by Skyarc Studios.

Skyarc Studios specializes in the development of Skyark Chronicles, a game that blends engaging anime-style fantasy elements with NFT-based character assets. Players had shown significant interest in the game, pledging $115 million worth of Ethereum in a massive NFT mint for a chance to claim one of these unique character assets.

The $15 million raised by Skyarc Studios is intended for the development and expansion of Skyark Chronicles. This includes further game development, enhancing the NFT minting process, and ensuring a smooth and engaging experience for players. The studio also started a refund process for the NFT mint, allowing traders who did not successfully secure one of the 8,000 mint slots to recover their Ethereum, emphasizing the studio's commitment to fairness and transparency towards its community and investors.

Skyark Chronicles is notable for its storyline featuring a fictional protagonist named Satoshi Nakamoto, drawing inspiration from the pseudonym of Bitcoin's real-world creator, although the game itself is not deeply rooted in Bitcoin lore or terminology. The game aims to create an immersive world where players, alongside chosen heroes, battle to restore peace to the Skylands, partially built on Binance's BNB chain with the latest batch of NFTs built on Ethereum.

AI Arena

AI Arena (website), developed by ArenaX Labs, successfully raised $6 million in its latest funding round. The investment was led by Framework Ventures, with contributions from SevenX Ventures, FunPlus / Xterio, and Moore Strategic Ventures. AI Arena is a PvP (Player vs. Player) platform fighter game that introduces an innovative concept where users train their own AI-powered characters to compete in battles. The effectiveness of these characters in combat is determined by the player's skill in training their AI, blending gaming with a deep educational focus on artificial intelligence.

The game, which is gearing up for a beta launch early this year, will be accessible as a free-to-play title running in browsers. Furthermore, ArenaX Labs is developing a web3 version to enable users to compete for rewards, emphasizing the educational aspect of helping users understand how AI functions and learns through an engaging gaming experience.

The capital raised will be utilized to further develop AI Arena, enhancing the PvP platform fighter and creating similar titles. ArenaX Labs aims to use gaming as a medium to educate players on AI, moving beyond superficial engagement to foster a true understanding and appreciation of this transformative technology. The investment underscores the belief in AI Arena's potential to democratize AI knowledge through interactive and competitive play, offering users a novel way to interface with and train AI within a gaming context.

Tune.FM

Tune.FM (website) has successfully raised $20 million from LDA Capital, a global investment group specializing in growth investing in mid-cap listed companies and crypto/blockchain projects. Tune.FM, also known as Tune Media Inc., is a web3 decentralized music streaming platform integrated with a music NFT marketplace. This platform enables artists to directly monetize their fanbase through streaming royalty micropayments and digital music collectibles, offering exclusive unlockable experiences.

Tune.FM is designed to empower artists by allowing them to earn 90% of their streaming revenue, which is significantly higher compared to traditional streaming services. By eliminating intermediaries, Tune.FM provides artists with greater control over their music distribution and monetization. The platform uses the JAM token ($JAM) to facilitate instant micropayments to artists for every second their music is streamed. It also offers a play-to-earn model for listeners to earn JAM tokens by discovering new music.

The $20 million funding from LDA Capital will be used to expand Tune.FM's development team, grow its user base, launch new product offerings, and increase liquidity for the JAM token across international markets. The investment signifies LDA Capital's commitment to supporting Tune.FM's mission to revolutionize the music industry by valuing and rewarding artists' work through the adoption of blockchain technology.

Looking ahead, Tune.FM plans to launch mobile apps for iOS and Android, as well as desktop applications for Mac and Windows. The platform also aims to negotiate licensing deals to onboard major label content and explore opportunities for labels and publishers to increase earnings through its technology. Furthermore, Tune.FM envisions creating a music festival metaverse for virtual live shows, reinforcing its goal to establish a more equitable and artist-centric music industry.

DeMR

DeMR (website), a decentralized Mixed Reality (MR) infrastructure network, has successfully raised capital through a strategic investment from KuCoin Labs, the incubator and investment arm of the KuCoin ecosystem. Although the specific amount of the investment was not disclosed in the provided text, this funding marks KuCoin Labs' first strategic investment in the DePIN (Decentralized Positioning and Indoor Navigation) track. This collaboration between DeMR and KuCoin Labs will focus on community operations and subsequent product development, reflecting KuCoin Labs' recognition of the DePIN track's potential and its understanding of the future development of the crypto industry.

DeMR operates on the Solana Chain and aims to enable global users to participate in scanning and building MR maps of various cities using consumer-grade devices. The platform supports the creation of infrastructure facilities through a decentralized distributed concurrent architecture, offering a Web3 underlying architecture for massive MR applications and global users. This technology allows for a seamless coexistence of the digital and real worlds, enabling access to a new world of spatial interconnection and virtual-real symbiosis anytime, anywhere.

The capital raised from KuCoin Labs will be used to further develop DeMR's decentralized Mixed Reality infrastructure, focusing on the integration of MR seamlessly with assets such as Compass NFTs, Land NFTs, and Node License NFTs. These assets are designed to foster strong connections within the DeMR ecology, amplifying their real-world influence and economic value. The funding will support DeMR in achieving its key milestones, enhancing the platform's ability to provide a Web3 underlying architecture for MR applications, and contributing to the global decentralized MR metaverse infrastructure.

DeMR's innovative approach includes features such as high-definition spatial localization, city-scale support, consumer-level scanning, adaptability to various environments, multi-device compatibility, and an AI-aided fully automatic mapping pipeline. The platform also introduces a novel "Scan-to-Earn" model, incentivizing contributors through the DeMR Network Token (DMR) and supporting a wide range of ecological applications and spatial traffic interconnection built on its advanced spatial computation technology.

Renzo

Renzo (website), an Ethereum restaking protocol based on EigenLayer, has successfully raised $3.2 million in a seed funding round. The round was led by Maven11 Capital and saw participation from Figment Capital, SevenX Ventures, IOSG Ventures, among other investors. This funding round, which was a combination of equity with token warrants in a 1:1 ratio, has elevated Renzo's valuation to $25 million, as shared by Lucas Kozinski, a founding contributor at Renzo.

Renzo's protocol allows users to restake ether (ETH) through EigenLayer, and it aims to incorporate support for liquid staking tokens (LSTs) in future updates. Currently, users can deposit ETH (and LSTs in the future) to receive Renzo's liquid restaking token (LRT), ezETH. This LRT can then be utilized in DeFi applications to generate additional yield on top of the ETH staking yield. Renzo distinguishes itself as a third-generation protocol capable of accepting both native ETH and LSTs, aiming to simplify and make restaking more accessible to a broader audience.

Within just a month of its beta mainnet launch, Renzo has managed to secure a total value locked (TVL) of over $35 million. This is in comparison to EigenLayer's TVL, which stands at about $7.5 billion.

The capital raised in this round will be allocated towards several key areas to support Renzo's growth and development. These include undergoing additional audits of the protocol, increasing the rewards for its bug bounty program on the Immunefi platform, integrating with more DeFi protocols to broaden its ecosystem, and expanding its team, which currently consists of about ten members, by hiring across various functions. Additionally, Renzo plans to launch its general mainnet following EigenLayer's Stage 3 launch and aims to extend its restaking services beyond Ethereum, supporting bridged liquid staking tokens on Layer 2 networks and other Layer 1 networks. This expansion will allow users to access restaking without the need to bridge back to the mainnet, facilitating cross-chain staking.

Clusters

Clusters (website), a Web3 names service developed by Delegate Labs, has successfully raised $9 million in a seed funding round. This round saw significant participation from a diverse group of investors including Variant, Collab+Currency, Arrington Capital, Mask Network, Electric Capital, PalmTree Crypto, Bloccelerate, Arca, and angel investors from notable companies such as Coinbase, Polygon, and MetaStreet.

Clusters leverages LayerZero's omnichain protocol to offer a unique cross-chain name service. This innovative platform allows users to purchase a domain on any blockchain and automatically have it recognized across other chains. Designed to address the fragmentation within the blockchain industry, Clusters enables users to interact with multiple blockchains without the need to switch wallets, simplifying the user experience significantly.

The platform is positioned as the first to be compatible with all blockchains, emphasizing ease of use as its core feature. By using backend bridges in collaboration with the interoperability protocol LayerZero, Clusters aims to aggregate assets in one place, facilitating seamless transactions, gaming experiences, and NFT holdings across different blockchains.

The capital raised in this round will be utilized to further develop the Clusters platform, enhancing its cross-chain capabilities and making it easier for users to interact with various blockchains without the hassle of managing multiple wallets. This investment underscores the confidence of the backers in Clusters' potential to simplify cross-chain interactions and contribute to the broader adoption of blockchain technology by making it more accessible to users.

Kasu

Kasu (website), a Real World Asset (RWA) business lending protocol, has successfully raised $3 million in a seed funding round. This round was led by Woodstock, Morningstar Ventures, and Faculty Group, with additional contributions from a notable list of investors including Cypher Capital, Matterblock, Andromeda Capital, NxGen, Rarestone Ventures, Asteroid Capital, and Optic Capital. The funding round also saw participation from leading Key Opinion Leaders (KOLs), industry angels, and selected Web3 investment syndicates, reflecting strong support for Kasu's innovative approach to RWA lending.

Kasu is a collaboration between Faculty Group and Apxium Technologies (Apxium), blending Faculty Group's expertise in Web3 and decentralized finance (DeFi) with Apxium's award-winning innovations in FinTech and traditional finance (TradFi). The protocol leverages proprietary technology to deliver optimized RWA yields in DeFi, focusing on improving businesses' cash flows and credit risk to offer superior risk management and higher quality yields.

The platform operates by utilizing Apxium's accounts receivable automation financing technology, which addresses the root cause of borrowing—late debtor collections—before lending to an optimized debtor book. This unique approach aims to revolutionize RWA lending by providing the most risk-optimized yields in DeFi. Apxium's technology has managed over $2 billion in annual invoice transaction volume across the US, UK, Canada, and Australia without a single dollar lost in invoice lending activities over its seven-year history.

The capital raised will be used to advance Kasu's innovative RWA lending platform, further developing its proprietary technology that optimizes businesses’ cash flows to improve credit risk. This includes enhancing automated debt recovery mechanisms and integrating robust structured credit solutions to deliver the most optimized risk-adjusted private credit RWA yields in all of DeFi. Kasu's approach not only democratizes access to real-world yield opportunities but also offers an intelligent solution for receivables and payables financing, benefiting both DeFi investors and traditional business borrowers.

Kasu's initiative represents a significant step forward in bridging the gap between DeFi liquidity and real-world financial needs, providing a sustainable and risk-optimized lending model for the future.

Rome Protocol

Rome Protocol (website), a shared sequencer (SS) leveraging Solana, successfully raised capital in a pre-seed funding round led by Portal. The investment amount totaled $3 million, positioning Rome Protocol at a valuation of $25 million. This strategic move was backed by a consortium of investors including Woodstock, Morningstar Ventures, Faculty Group, and several others, alongside participation from angel investors and selected Web3 investment syndicates.

Rome Protocol operates as a decentralized block production layer, specifically catering to rollups such as OP Stack, ZK Stack, Arbitrum, Eclipse, Scroll, and more. These rollups, traditionally built on Ethereum or using Celestia for a more modular stack, benefit from Rome's shared sequencer by decentralizing transaction sequencing and enabling cross-rollup atomic composition. The protocol addresses key issues associated with centralized sequencers, such as limited visibility into transaction ordering, excessive wait times for inclusion, and high costs of generating proofs.

By utilizing Solana's performance and security features, Rome Protocol stands out from existing shared sequencers within the EVM ecosystem. It aims to unlock interoperability between Solana and Ethereum, providing a secure, cost-effective, and fast solution for block building. This innovative approach facilitates non-custodial and trustless bridging between Ethereum and Solana, cross-domain arbitrage, and enables the development of dual-chain games and dApps.

The capital raised will be allocated towards advancing Rome Protocol's development, focusing on its unique positioning to bridge liquidity between Solana and Ethereum. This includes enhancing the platform's interoperability features, improving security measures, and expanding its user base. Rome Protocol's goal is to grow a new "pie" of liquidity between two of the largest market-cap ecosystems, moving beyond merely "slicing the pie" within the rollup stacks or EVM liquidity.

Closing Thoughts

It is encouraging to witness an increase in capital flowing into the early stages of the crypto industry, following a period of declining funding. Sectors that are popular among crypto venture capital firms tend to become popular among the general public around 12-18 months later. It is fascinating to observe the growing demand for the Bitcoin Economy, AI, Restaking, and gaming. Make sure to explore and utilize these early-stage projects, as you may receive handsome rewards through an airdrop!

That’s it for this month’s top 10 crypto projects that raised funding! If you’d like to receive the next edition, and all our other top content, directly in your inbox, subscribe to our no-nonsense weekly newsletter here!