OKX Ventures Quarterly Investment Report: Multi-field layout to help industry development

Source: OKX Ventures

With the milestone of the US SEC approving the BTC spot ETF in January 2024, the crypto industry has gradually emerged from the cold winter and entered a boom. We saw that the total market value of Crypto reached 2.6 trillion US dollars in the first quarter of 2024, the total supply of stablecoins exceeded 150 billion US dollars, and the market value of Bitcoin once exceeded that of silver. More new narratives such as re-staking, the combination of Web3 and AI, and Bitcoin programmability have emerged and performed strongly, promoting further innovation and development in the crypto market.

The capital market has gradually warmed up, with the total financing scale of more than 1.8 billion US dollars in the quarter, an increase of 50% over the previous quarter. During this period, OKX Ventures continued to increase its investment, deeply participate, and continuously explore high-potential, innovative projects and teams in the crypto industry, actively invest in and empower entrepreneurs, provide all-round support, and contribute to the development of the crypto industry.

Review of key projects in the quarter

In the first quarter of 2024, OKX Ventures' investments covered multiple tracks, including infrastructure, Bitcoin ecology, AI+Depin, Gamefi, Defi, Socialfi, etc., of which infrastructure projects accounted for 60% of the total investment. We believe that the perfection of infrastructure is still the mainstay driving the development of the entire industry. Complete infrastructure can effectively improve the efficiency and security of the entire industry and provide a solid foundation for the rapid development of the industry.

1.infra

Infrastructure is the top priority for the development of the industry. It includes but is not limited to underlying products such as L1/L2 public chains, development platforms and wallets. These products determine the development speed of upper-level applications. Therefore, the infrastructure of blockchain has always been a track that crypto investment institutions focus on. Recently, with the explosive growth of the Bitcoin ecosystem and the emergence of Ethereum's Dencun upgrade, OKX Ventures has also invested heavily in this, promoting the continuous improvement and upgrading of the infrastructure.

• AltLayer is a highly scalable application-specific execution layer system built on Optimistic Rollups. It can be connected with Ethereum, Solana, Polkadot, Cosmos, and even Arbitrum, Optimism and other Layer1 and Layer2 to expand it. In order to better serve developers, AltLayer created Rollups-as-a-Service (RaaS), a versatile, custom Rollup creation platform that does not require programming experience. In addition, AltLayer introduced the concept of instant Rollups. This is a highly optimized Rollup technology that allows dApp developers to quickly deploy specific Rollups, provide security through Layer 1, and then easily settle when needed.

• Cysic is a zero-knowledge (ZK) hardware company that aims to provide efficient hardware acceleration solutions for ZK proof protocols to help reduce ZK proof generation time and power consumption. The Cysic team has developed FPGA and GPU underlying code libraries for calculations such as multi-scalar multiplication (MSM), number theoretic transformation (NTT) Merkle hash numbers, which are important components in the ZK protocol, and is also developing ASIC solutions. Running calculations such as MSM on the CPU is very power-consuming and time-consuming, which is why Cysic focuses on trying to use FPGA, GPU, and ASIC to accelerate these components.

• DEXTools is the world's leading DEFI portfolio and cryptocurrency price tracking application. For enthusiasts and traders in the crypto world, DEXTools helps them keep abreast of real-time cryptocurrency prices, price alerts, whale movements, blockchain statistics, and DEFI market trends. With an average of 20 million users per month, DEXTools is an important hub between users and Defi.

• Eclipse is an Ethereum Layer2 solution powered by the Solana Virtual Machine (SVM) to improve the scalability and efficiency of blockchains. It integrates Ethereum's secure settlement with SVM's high-performance execution, Celestia's data availability, and RISC Zero's zero-knowledge proofs, aiming to achieve high throughput without sacrificing security.

• Lumoz is a decentralized ZK-RaaS network and a PoW network that supports ZKP mining. It uses a combination of PoS and PoW mechanisms. Lumoz aims to simplify the use of ZK-Rollup and promote its widespread adoption, thereby promoting the large-scale deployment of zkEVM-based application chains. Developers can use Lumoz to deploy their ZK-Rollup (zkEVM) on multiple chains. For miners, Lumoz is a multi-chain PoW protocol that supports mining on various public chains and generating zero-knowledge proofs for ZK-Rollups.

• Taiko is a decentralized ZK-EVM and general ZK-Rollup. Its purpose is to allow developers and users of dApps developed for Ethereum L1 to use Taiko without any changes. With Taiko, developers can more easily deploy dApps to L2, and inherit the security of Ethereum while incurring lower transaction fees than L1. Taiko consists of three parts: zkEVM for generating proofs, L2 rollup nodes for management, and Taiko Protocol for rollup verification.

• ZeroGravity (0G for short) is the first data availability system with a built-in universal storage layer, which has super scalability and decentralization. It achieves scalability by dividing the data availability workflow into a data publishing channel and a data storage channel. Its products include data availability layer: 0G DA and data storage layer: 0G Storage.

• zkMe is a zk Identity Oracle that provides anonymous user verification on-chain for improved security and privacy. zkMe verifies user credentials without revealing any personal information to anyone. When a user (credential holder) creates a DID using zkMe, they are given a unique SBT, which is cryptographically bound to their public key and used as proof of identity, enabling users to verify their identity through ZKP without revealing any sensitive information.

Public chains are the most important track in crypto infrastructure, and OKX Ventures has bet on popular projects such as AltLayer and Taiko. The development of the DA layer supports projects such as ZeroGravity. In terms of other infrastructure, we have also worked closely with projects such as DEXTools, a leading cryptocurrency price tracking application.

2. Bitcoin Ecosystem

It can be said that the Bitcoin ecosystem is the starting point of this round of bull market. From the end of 2023 to the beginning of 2024, a variety of protocols, infrastructures, token standards, cross-chain bridges, Rollups and other innovative solutions have emerged, activating the prosperity and development of the Bitcoin ecosystem. OKX Ventures is also following closely, and has made significant progress in terms of funding, cooperation and resource grafting.

• Babylon is a Bitcoin staking protocol that allows Bitcoin holders to stake their idle Bitcoins to increase the security of the PoS (Proof-of-Stake) chain and earn income in the process. It is a PoS Cosmos zone blockchain that uses extractable one-time signature (EOTS) technology to introduce PoS chains through original chain staking, realizing a non-cross-chain, non-fork Bitcoin staking mechanism, and using Bitcoin PoW as a timestamp and data availability layer, thereby providing native security based on BTC.

• B² Network is an EVM-compatible Bitcoin second-layer network developed based on ZK-Rollup, which enables EVM ecosystem developers to seamlessly deploy Dapps. B^2 anchors the data merkle tree root hash and proof of zk-rollup to the Bitcoin network through tapscript, putting both the process and the results on the chain for easy verification, and realizing a BTC layer 2 with higher legitimacy and availability.

• Merlin Chain was developed by the Bitmap Tech team and is a Layer2 based on the BTC network and using ZK-Rollup. Using ZK technology, the transaction is compressed, and then the compressed transaction data and ZK proof are uploaded to Taproot on Bitcoin L1 through a decentralized Oracle network for use by the entire network to ensure transparency and security.

• UniSat Wallet is a leading BTC and inscription wallet that supports inscription, trading and other services for BTC assets such as BRC20, and as one of the index service providers, it provides infrastructure services for assets such as BRC20 for the crypto industry. Unisat continues to deepen the BTC ecosystem, such as the recent proposal to add the function of autonomous minting and destruction of BRC20 to support the issuance of stablecoins in BRC20, and the upcoming Bitcoin expansion solution Fractal.

• bitSmiley is the first native stablecoin project in the BTC ecosystem. It is a comprehensive financial protocol built on the Bitcoin blockchain as part of the Fintegra framework. Its core product is BitUSD, an over-collateralized stablecoin based on BTC. Users pledge BTC to BitSmiley DAO and mint BitUSD. Unlike Maker DAO, bitSmiley auctions the platform's future revenue as debt and repays creditors first. In addition, BitUSD uses the new bitRC20 inscription format that is compatible with BRC-20.

• Bounce Finance is a multi-chain decentralized auction protocol. Focusing on Auction as a service, it provides a variety of auction products, including token and NFT auctions, real-world collectibles auctions, advertising space auctions, and SDKs and plug-ins. In addition, Bounce Finance also provides Private Launchpad services, an on-chain solution designed to simplify the IDO of new projects. Currently, Bounce Finance focuses on the BTC ecosystem and focuses on providing incubation and auction support.

• DLC.Link provides a range of applications through the Discreet Log Contract (DLC) that allows application developers to easily integrate native Bitcoin. The platform locks Bitcoin in on-chain custody, from where it can be used by Ethereum and other smart contract blockchains. This "trustless bridge" makes lending, trading, derivatives, etc. possible. At the same time, dlcBTC's non-custodial packaging method allows users to manage Bitcoin on their own without worrying about third-party risks, such as mismanagement or theft of assets.

As you can see, OKX Ventures has made extensive investments in the Bitcoin ecosystem in the past few months, from L2's technical facility Bitmap, to the defi protocol Bounce Finance, to the inscription wallet Unisat. Through our all-round layout of the Bitcoin ecosystem, we have provided good support for the development of the entire ecosystem and even the crypto industry. At the same time, we are also actively carrying out cooperation related to the Bitcoin ecosystem, such as Babylon, to promote the accelerated development of the industry by encouraging more and more participants to join.

Three,Gamefi

In the second half of 2023, Gamefi also gradually began to recover its vitality with the development of the general trend. The marketplace and infrastructure related to full-chain games, card games, and Web3 games have received widespread attention from the capital market. During this period, OKX Ventures has also made early arrangements and has become one of our investment focuses.

• Carv.io is a Web3 identity company & game aggregation platform that has developed a solution that combines web2 and web3 data to create a unique user web3 ID. On this basis, Carv has also established a series of game chain data infrastructures, with the mission of establishing a game identity owned by players and realizing data value through game data sharing. Its main products include: CARV Protocol underlying data solution CARV Protocol and its first Dapp on the Protocol, CARV Play, which provides basic functions such as game distribution, game activities, and chain activities.

• Mocaverse Platform is a decentralized version of the app store for web3 games & entertainment created by Animoca Brands integrating its 450+ portfolios. Its users can apply for a Moca ID, which will become their Web3 login (similar to Apple ID), allowing users to interact with Dapps on the platform.

• Lumiterra is a multiplayer open world survival game, in which players can freely choose to cultivate combat talents, farm talents, and gathering talents. No longer limited to traditional professions, players can create unique characters according to their interests. At the same time, the Sodium wallet built by Lumiterra uses ERC-4337, ZK and MPC technologies, allowing users to easily log in and manage assets with extremely high security.

• BLOCKLORDS is a 3A SLG multiplayer strategy game (MMO) based on a multi-chain network launched by the game studio MetaKing Studios. Players can play different medieval roles, manage their own farms, recruit teams, collect resources, assign heroes to teams, and upgrade buildings in the process. Create your own unique epic in the medieval universe.

• L3E7 is a pure 3D LBS (Location Based Service) game. Through map graphics rendering technology, players are immersed in a 3D metaverse world. L3E7's metaverse is created based on cities on the real earth, where players can experience what the real world looks like, and it is presented in a cyberpunk art style.

It can be seen that OKX Ventures supports all aspects from basic settings to upper-level applications in the field of Gamefi, from the game identity solution Carv to the large-scale 3D game L3E7. At the same time, we are also vigorously carrying out relevant cooperation, such as Mocaverse, to involve more users through activities and promote the vigorous development of the Gamefi field. In the future, the combination between game projects and DeFi projects will continue to improve, creating more attractive games and more sustainable business models.

Fourth,Defi

DEFI is an important innovation in the crypto market. It provides financial services to a large number of user groups in a decentralized manner through smart contracts. OKX Ventures has seen that since the Defi Summer, projects in this field have been constantly innovating and providing Web3 users with various high-potential use cases, especially the liquidity staking boom since Ethereum switched to the PoS chain, which provides Web3 users with an option that can bring income and increase asset utilization, as well as the resulting re-staking, which brings both income to users and security to projects. Both have become the two most popular directions in the Defi field, stimulating continuous project innovation and ecological improvement.

• Navi is one of the DEFI protocols with the highest TVL in the SUI ecosystem, with a TVL of about US$150 million. Navi provides users with lending services for long-tail assets on the chain, and cooperates with multiple protocols such as HeroSwap, Ondo Finance, Cetus, etc. to unlock and improve various Defi use cases, and through the acquisition of the LSD protocol Volo, it provides users with fully decentralized liquidity staking services and further builds a one-stop Defi platform.

• Ether.fi provides a fully decentralized liquidity staking service, on which the staked tokens have grown rapidly since the beginning of 24, and the total value has now exceeded 2.9 billion US dollars. Ether.fi supports pledgers to maintain control of their keys when acting as a staking agent, and the ETH staked to Etherfi will naturally be placed in the EigenLayer for re-staking, thereby ensuring a higher degree of decentralization while bringing users multiple rewards including staking, re-staking and platform rewards, promoting the rapid growth of the protocol.

• Renzo is also a leading project focusing on the field of new liquidity staking. In addition to allowing users to stake native Ethereum to obtain liquidity staking and re-staking income, it also supports the use of more LSD tokens for re-staking. At present, Renzo has more than 1.25 billion US dollars of assets pledged on it.

OKX Ventures focuses on innovation and high-potential projects in the DEFI field, and is optimistic about the vitality that emerging narratives can bring to the DEFI field, helping its projects to provide Web3 users with complete and high-quality products and services.

V.AI

We have seen the explosive growth of the AI ​​track, and the crypto industry has explored the combination with AI. Web3 and AI are both developing rapidly, and new points of integration are constantly emerging. OKX Ventures focuses on projects and teams that can bring innovation to the crypto field and bring potential application scenarios and opportunities in this process.

• io.net is a decentralized GPU network based on Solana, which aims to build a distributed computing network by aggregating idle GPU resources from around the world to provide low-cost and efficient computing resources for artificial intelligence (AI) and machine learning (ML). And through a simple UI interface and integrated platform and data management program and architecture, etc., in order to provide a computing platform with higher performance and more complete infrastructure.

• Myshell focuses on building an interactive AI robot creation platform. The platform can generate an AI that interacts with users through user input information. By adding voice templates, it can shape AI with unique "personality", interaction methods and voice based on user settings. In addition to chatting with users, it can also cover translation, text generation and other use cases.

• 0xScope aims to build an open data layer for Web3 data analysis, and provides a series of tools and services to help users understand and utilize Web3 data. Through a clear and direct interface, it can generate data analysis reports for the Web3 industry, or perform comprehensive on-chain behavior analysis on specific addresses, just like ChatGPT.

• FLock is an AI co-creation platform that encourages users to contribute computing power, AI models and private data through a decentralized platform, and promotes the generation of community-oriented AI models. Through cooperation among all parties, promote AI innovation.

• Meson Network aims to build a decentralized bandwidth network, using user-friendly nodes, and through an incentive model, gathers and redistributes loans contributed by users around the world, links both ends of the supply, and forms a sustainable economic cycle. Meson Network has currently absorbed more than 250,000 nodes worldwide to support bandwidth needs around the world.

AI and Web3 can be combined and help each other in many ways. From empowering Web3 infrastructure with AI to using AI to power Web3 application platforms, we are optimistic about the ability of high-quality teams to promote a better combination of the two. OKX Ventures believes that with the further development and integration of the two fields of Web3 and AI, the relevant points of integration will be more perfect, which will also stimulate the further development of the two fields of Web3 and AI.

Conclusion:

OKX Ventures believes that with the innovative breakthroughs in the Bitcoin ecosystem, L2 will enter an acceleration period, high-quality game content will go from the testing phase to the official release, and DeFi will continue to innovate with the development of infrastructure. 2024 will be very exciting. At the same time, OKX Ventures also looks forward to actively cooperating with high-quality project parties, in-depth support, providing users with high-quality services, and contributing to the industry.