I would like to be a language translator for English.
Original Author: Zen, PANews
In the first half of last year, while the secondary market in the cryptocurrency industry continued to decline, there was still a large amount of funds in the primary market waiting for opportunities. During this period, there were numerous venture capital funds with a scale of over one hundred million dollars, becoming the source of growth in the cryptocurrency market. Among them, "dao 5", a cryptocurrency venture capital fund established by former Polychain Capital general partner Tekin Salimi in February last year, announced the raising of $125 million at the end of the following month.
According to the official introduction, dao 5 focuses on Layer 1 blockchain infrastructure, privacy technology, DeFi, DAO, games, NFT, and Web3 social platforms, providing funding of 500,000 to 2 million US dollars for seed and seed round financing. Different from other venture capital funds, dao 5 also plans to obtain talent and capital through risk financing in order to ultimately transform into a DAO shared and governed by investors and project founders.
From Corporate Lawyer to Web3 Venture Capitalist
Tekin Salimi initially worked as a corporate lawyer at the renowned Canadian law firm Torys LLP, specializing in M&A, debt financing, and securities law. At that time, he was already an avid cryptocurrency enthusiast, often conducting research on blockchain/Web 3 in his spare time, and publishing his research articles on social media and platforms such as Cointelegraph. In early 2018, he went "All in Web3" and joined Polychain Capital, a well-known cryptocurrency investment fund, as a general partner. The fund, founded by Olaf Carlson-Wee, Coinbase's first employee, had early investments from Andreessen Horowitz, Sequoia Capital, and others.
In February 2022, Tekin Salimi left Polychain Capital and founded the experimental cryptocurrency investment fund DAO 5. He quickly raised $125 million from native cryptocurrency investors specifically for seed round and pre-seed round financing of early-stage companies. Advisors of DAO 5 include Emin Gün Sirer, founder of Ava Labs, Ben Fisch, founder of Espresso Systems, Ivan Soto-Wright, founder of Moonpay, and other well-known figures or investors in the cryptocurrency industry. At that time, Do Kwon, known as the "genius" from South Korea, was also part of this lineup, and soon after, the shocking collapse of TerraUSD and Luna occurred.
Achieve DAO Transformation by 2025
Tekin Salimi plans to develop dao 5 into a decentralized autonomous organization. The plan is still in its early stages and is expected to be implemented by around 2025. The management, operations, investments, and other affairs will be governed by dao 5 token holders. Contributors who successfully submit investment proposals for the future DAO will receive corresponding rewards in the project's economic growth. The 3-year transition period is designed to provide enough time to create a suitable token economy and governance model for the DAO, thereby increasing participation and ensuring simplified incentives.
According to the plan, the tokens minted by dao 5 will be distributed to the investment team, advisory committee, and founding members of portfolio companies, allowing them to directly share the profits obtained from dao 5. This collective interest-based token distribution will ensure that the project founders are incentivized and enhance the economic connections and cooperation among projects in dao 5's portfolio. This cooperation model serves as a form of risk diversification and also provides value to projects under dao 5.
Focus on Infrastructure Investment
According to incomplete statistics from PANews, dao 5, which has been established for a year and a half, has not made a high number of investments. Currently, it has participated in early-stage financing for 14 cryptocurrency projects. Looking at the invested projects, dao 5 focuses on DeFi and infrastructure sectors, with an emphasis on data, privacy, and social areas. In addition, Polychain Capital, Salimi's former employer, has led investments in 5 projects, including Layer 1 public chain Berachain and Web3 infrastructure startup Polyhedra Network.
The following is a brief introduction of dao 5's investment projects (if dao 5 is a participant in the financing, it will not be listed):
DeFi:
EigenLayer: A re-staking protocol built on Ethereum, the underlying team EigenLabs raised $14.5 million in a seed round led by Polychain Capital and Ethereal Ventures. In March of this year, they also completed a $50 million Series A funding round led by Blockchain Capital, with participation from Coinbase Ventures and others.
Tonic: A DEX protocol in the NEAR ecosystem, with a $5 million financing round led by Electric Capital and MOVE Capital, and participation from Framework Ventures and market makers GSR, Wintermute, Flow Traders, etc. Tonic is building a decentralized protocol for quick and seamless trading of any asset on NEAR and Aurora.
AlloyX: A DeFi protocol, with a $2 million pre-seed funding round led by Hack VC and participation from Circle Ventures, etc. AlloyX combines Credix Finance's over-collateralized tokenized credit (digital tokens backed by real-world assets such as loans or debt instruments) with smart contracts for tokenized US Treasury bonds, providing DeFi investors with opportunities for real-world asset liquidity.
Block Green: A lending protocol aimed at enabling Bitcoin pledging, raised $3.7 million in a seed round led by Peter Thiel's Founders Fund, with participation from Coinbase Ventures, etc. Block Green allows Bitcoin miners to use their future Bitcoin production as collateral by borrowing against their hash power.
Infrastructure & Tools
Berachain: A Layer 1 public chain that raised $42 million in a private token funding round led by Polychain Capital, with participation from OKX Ventures, Shima Capital, etc. The Berachain network is built on the Cosmos SDK and will be EVM compatible. Berachain is currently available as a development network (devnet) and may release its mainnet later this year.
Story Protocol: A Web3 startup that raised $29.3 million in a seed funding round led by a16z Crypto, with participation from Hashed, Samsung Next Fund, etc. Story Protocol provides a way to create, manage, and license intellectual property on-chain, forming a remixable and composable storytelling Lego ecosystem that enables creators to create stories with ownership and incentives.
Lens Protocol: Web3 social graph protocol, completed a $15 million financing led by IDEO CoLab Ventures, with participation from Blockchain Capital, Uniswap CEO Hayden Adams, Polygon co-founder Sandeep Nailwal, and others. The protocol, built by Aave, allows users to lend and borrow crypto tokens from each other.
SPACE ID: Decentralized domain name protocol, completed a $10 million strategic financing led by Polychain Capital and dao 5. SPACEID previously completed a seed round financing led by Binance Labs and launched .bnb domain name services.
Axelar: Blockchain interoperability network, supported by over 15 blockchain investors including Dragonfly Capital, for its $60 million ecosystem bootstrap fund aiming to accelerate the development of decentralized applications and protocols that can replace centralized exchanges.
Bitquery: Blockchain data company, raised $8.5 million in seed financing led by Binance Labs and dao 5. Bitquery provides a suite of software products to parse, index, and store blockchain data in a unified manner.
Sunscreen: Web3 privacy startup founded by Ravital Solomon and MacLane Wilkison, co-founder of privacy network NuCypher. The seed round financing was led by Polychain Capital, raising $4.65 million. Sunscreen aims to enhance the privacy potential of Web3 using fully homomorphic encryption (FHE) technology, which allows individuals to perform computations on encrypted data without needing to decrypt it.
Cubist: Web3 development tools provider, raised $7 million in a seed financing round led by Polychain Capital, with participation from Polygon, Amplify Partners, and Axelar.
Polyhedra Network: Web3 infrastructure startup, raised $10 million in a financing round led by Binance Labs and Polychain Capital, with participation from Animoca Brands. Polyhedra has developed various infrastructure products using zero-knowledge (ZK) proof technology, including the ZK bridge (zkBridge) solution for asset transfers between Web2 and Web3 systems, ZK decentralized identity solution (zkDID), and scalability solutions.
Hyper Oracle: The ZK Oracle Network has raised $3 million in seed funding in a round led by dao 5 and Sequoia Capital China Seed Fund. Participating investors include Foresight Ventures and FutureMoney Group. Hyper Oracle is collaborating with zkWASM virtual machine to develop new indexing and automation protocols to address the challenges of security, decentralization, computational integrity, and performance in blockchain middleware.
