VYSYN Ventures reviews its portfolio and details the company’s investment thesis
Disclaimer: Reported market capitalizations and returns are accurate as of the time of writing and are subject to change. This report was written between the 22nd and 25th of April 2021.
VYSYN Ventures has become a stalwart of the cryptocurrency venture capital ecosystem. Since 2016, VYSYN has been helping disruptive blockchain startups fulfill their potential.
Through capital allocation and incubation, VYSYN has helped a myriad of innovative projects grow to hundreds of millions and even billions in USD valuations. VYSYN’s incubation process separates the company from other venture capital players.
The incubation process includes assistance with both marketing efforts and tech development. With experience working with a wide variety of cryptocurrency startups, VYSYN knows how to tailor marketing strategies to spread brand awareness and build a community of diehard advocates. VYSYN has helped projects build Telegram community groups, social media followings, and insightful newsletter campaigns.
Blockchain startups can also be constrained on resources which often leaves them with small developer teams. This often slows progress and frustrates stakeholders. VYSYN can provide critical development resources when they’re most needed. This helps VYSYN-supported projects accelerate development and streamlines the process of delivering a working product to market.
VYSYN’s investment track record highlights the company’s proficiency at supporting high-performing startups. This piece highlights the key projects that VYSYN has developed long-term positions in.
ACDX — Founded by former OKEx COO Andy Cheung, ACDX launched in September 2020 and quickly became a leading cryptocurrency exchange. ACDX has catered to daily trading volumes of over $100 million. VYSYN Ventures was an early-stage investor in ACDX. Before the ACDX launch, VYSYN issued a newsletter release to its community detailing why ACDX was shaping up to be an extraordinary long-term investment.
Wootrade Network — Wootrade is another market infrastructure play that has resulted in significant returns for VYSYN. Wootrade is a market that provides zero fees and deep liquidity for both the cryptocurrency spot and futures markets. VYSYN detailed Wootrade in a newsletter release in October 2020 and highlighted its preferential bid-order spread compared to Coinbase. VYSYN’s investment in Wootrade has produced a return of over 20x.
Polkastarter — In 2017, a frenzy surrounding initial coin offerings (ICOs) took place on the Ethereum blockchain. With Polkadot launching in May 2020 to challenge Ethereum’s position as the leading decentralized computing blockchain, Polkastarter emerged to be the leading project to facilitate fundraising efforts on the Polkadot blockchain. VYSYN Ventures anticipated the need for a platform that could coordinate more organized fundraising for upcoming Polkadot projects. Such a platform was particularly needed given the gloomy aftermath of the Ethereum ICO fundraising boom in 2017–2018. Polkastarter was positioned to fill this need and VYSYN became an early-stage investor in the project. Polkastarter currently has a market capitalization of over $147 million and VYSYN has recorded an over 60x return since investing in the project.
Finminity — Finminity is another Polkadot-based fundraising platform. The platform specializes in helping DeFi projects raise funds in a decentralized way. Finminity has focused intensely on creating a platform that maximizes investor safety and allows companies to remain compliant while fundraising.
THORChain — THORChain is a top-50 cryptocurrency project. THORChain was the perfect project to benefit from the increased adoption of DeFi in 2020. Decentralized and autonomous, THORChain is an automated market maker (AMM) that provides a decentralized way for speculators to trade tokens in spot markets. VYSYN’s early-stage allocation in the project has recorded lucrative returns given the projects’ rise to rank among the top 50 blockchain projects. To date, VYSYN’s investment in THORChain has recorded a return of over 650x. Other VC companies have also recognized the long-term potential of THORChain with Multicoin Capital building one of its biggest positions in the coin. The THORChain network is currently valued at over $3 billion.
Polkamarkets — In February, VYSYN announced an investment in a decentralized predictions market that will be underpinned by the Polkadot blockchain. Incumbent decentralized prediction markets have failed to deliver despite the enormous opportunity for such a technology. VYSYN foresees Polkamarkets becoming the leading decentralized prediction marketplace. The early-stage project is currently valued at roughly $27 million.
Insured Finance — Insured Finance is another emerging Polkadot-based project that is working towards disrupting the incumbent players who mainly reside on the Ethereum blockchain. Insured Finance is an upcoming insurance marketplace that allows users to secure coverage that is tailored to their specific portfolio. It improves the incumbent Ethereum-based offerings that typically provide standardized insurance which can only cover a limited number of scenarios. The insurance possibilities of Insured Finance encompass exchange hacks, smart contract failure, and rug pulls. VYSYN has supported Insured Finance from the start and has provided marketing assistance throughout the project’s development.
Cash Tech — Cash Tech is another disruptive project that VYSYN has supported from the very start. Cash Tech aims to become the most comprehensive and versatile storage solution for digital asset holders. The application will encompass diverse DeFi functionality and provide support for multiple blockchains. With incumbent cryptocurrency applications offering narrow functionality and having poor designs, the vision of Cash Tech resonated with VYSYN. VYSYN was among the earliest investors in Cash Tech and has actively helped them with their strategy.
ETHBox — Improving the infrastructure built upon blockchain technology is among the key imperatives of VYSYN Ventures. ETHBox is a project that is working towards just that. ETHBox has developed smart contracts that provide digital escrow services. Such services have some handy applications! An ETHBox user who mistypes and mistakenly sends funds to the wrong address can easily retrieve their funds. VYSYN announced an investment in ETHBox in February 2021 and has since provided ongoing support to the project.
Equalizer Finance — Equalizer Finance is another Ethereum infrastructure play that VYSYN built a considerable position in. Equalizer Finance brings a new type of lending to the DeFi markets, enabling Ethereum users to quickly access loans with no collateral. Called Flash Loans, these loans are executed within the timeframe of a block being added. The transaction with the loan is reversed in the case that a lender does not return the principal. Such loans would be extremely valuable to fast-paced market players like arbitrageurs and leveraged speculators who quickly need collateral. VYSYN invested in Equalizer in April 2021.
Exeedme — Blockchain-based gaming platform Exeedme is addressing a market that has the potential to grow to hundreds of billions in USD value. In 2019, online gaming was valued at $150 billion and it is anticipated to grow to $256 billion by 2025. Blockchain gaming platforms are representing a growing portion of this market. ExeedMe provides an innovative way for gamers to monetize their skills and earn an income through their passion. This is a particularly high-potential field given the rise of gamers like PewDiePie who can successfully monetize their gaming activities through online platforms. In December 2020, VYSYN announced an investment in ExeedMe. The market capitalization of ExeedMe has since grown to over $50 million.
Ultra — Ultra is another cryptocurrency protocol that is addressing the lucrative gaming market. Ultra has launched a protocol that enables anyone to deploy their own in-game items trading platform. Ultra is working towards bringing the benefits of blockchain technology to the broader gaming market by enabling already established games to integrate such trading platforms. The protocol is currently valued at over $250 million.
DigiCol — NFT activity and interest has surged in 2021. VYSYN Ventures observed early signs of NFT activity increasing in Q4 of 2020 and began considering platforms that were setting up to be the infrastructure for the next wave of NFT trading and adoption. VYSYN’s search led them to DigiCol, a platform for one-click NFT creation. DigiCol allows content creators to easily design NFTs and launch them into a liquid marketplace. VYSYN took an early-stage position in DigiCol. The platform is currently valued at close to $5 million.
GAINs Associates — Infrastructure plays are only one of the ways which value is captured in the cryptocurrency market. VYSYN has invested in GAINS Associates, one of the biggest cryptocurrency community groups. GAINS is valued at over $18 million and VYSYN worked closely with the group founders for several marketing initiatives.
LEO Token — LEO token was one of the most highly-demanded private sales in the history of the cryptocurrency market. Venture Capital companies scrambled to secure an allocation in the token that was being issued in the aftermath of the Bitfinex hack. VYSYN successfully secured a significant allocation. The project is currently valued at over $2 billion.
NEO — Along with LEO token and THORChain, VYSYN has positions in several other multi-billion dollar cryptocurrency projects. VYSYN was an early investor in Antshares (now NEO), a Chinese decentralized computing network that intensely rivalled Ethereum during the 2017 market cycle. NEO remains a top-25 coin and is currently valued at roughly $6 billion.
Wanchain — VYSYN was an early stage investor in another Chinese project that captured significant interest and attention during the previous market cycle. Wanchain works relentlessly towards making blockchain technology and DeFi interoperable through the implementation of their decentralized network. Wanchain was an early leader in the field of interoperability. Several competitors have since surfaced to challenge its position and have successfully captured greater attention. Despite the competition, Wanchain maintains a valuation of over $230 million.
ICON — South Korean project ICON is one of the interoperability solutions that intensely challenged Wanchain. VYSYN quickly identified the potential of ICON. The project formed key partnerships with some of the biggest and most respected enterprises in South Korea. Icon grew to rank among the leading interoperability solutions. The project maintains a valuation of over $1 billion.
Zilliqa — The Zilliqa blockchain emerged as a competitor to the Ethereum network in 2017. The blockchain utilizes sharding technology to significantly increase the transaction throughput of the network. Zilliqa is also participating in an intensely competitive field with blockchains like Polkadot, EOS, and Tron all challenging Ethereum’s leadership position. Zilliqa has nonetheless attracted adoption from Dapp developers and blockchain users. VYSYN’s investment in the Ethereum competitor has performed strongly with the project having a market valuation of over $1.8 billion.
Holochain — Holochain is another multi-billion dollar project that VYSYN identified as holding significant potential. Holochain is an infrastructure that allows both developers and anybody with a device to benefit from the properties of blockchain technology. The solution has been widely adopted and prides itself on giving autonomy to the user, being energy efficient, and enabling versatile solutions.
Handshake — Domain names have always been a high-potential fit for blockchain technology. The technology offers the possibility to purchase and store domain names in a decentralized and permissionless database. Early projects, like Namecoin, emerged to address this area. However, these projects failed. Handshake has innovated upon the previous generations and has secured significant adoption. VYSYN invested in and supported the next-generation domain name project. The project is currently valued at over $190 million.
Ampleforth — Ampleforth is a cryptocurrency network that combines the benefits of a decentralized network with the stability of a fiat currency. Ampleforth has a supply that rebases based on specific rules that are maintained by the decentralized network. The adaptive supply gives price stability to the Ampleforth cryptocurrency and allows it to be used in scenarios where volatile currencies are unsuitable. VYSYN has supported Ampleforth since the early stages of the project and has observed it grow into a network with a valuation of over $350 million.
MiL.k Alliance — Reward points are ubiquitous in the commercial world. Airlines, supermarkets, and the travel industry all issue reward points to incentivize consumers to use their services. However, not every consumer intends to use the points that are issued to them. MiL.k Alliance provides a distributed network that enables users to gather and trade their reward points. Reward points received in one business can be exchanged for one that the consumer intends to use. MiLk. Alliance is currently valued at over $116 million.
Orakuru — The market for providing real-world data to decentralized applications is a large and growing market. Chainlink has successfully dominated this market and previously ranked in the top five cryptocurrencies. Orakuru is a competitor in this market and uses its decentralized network of nodes to capture real-world data and feed it into blockchain applications. The market potential is enormous with decentralized exchanges, prediction markets, and insurance solutions all requiring accurate off-chain data.
VYSYN Ventures prides itself in only supporting projects that are committed to bringing innovative and disruptive solutions to the market. After four years of active investing in the market, VYSYN Ventures has become a stalwart of the cryptocurrency venture capital ecosystem. The company has developed and refined a process to identify the most disruptive and high potential projects that have significant upside potential. The performance of VYSYN Ventures investments to date is a testament to the investing process of the company and the incubation process offered to its supported startups.