Capital flows and alternative funding models fuel crypto startups.

Venture capitalists have returned to crypto, offering alternative funding methods for startups, such as grants and cross-selling.

Base-native lending platform Seamless, for example, has announced that a joint initiative with Layer-3 Degen Chain and semi-fungible token protocol Pandora will distribute nearly $600,000 in grants to creators and developers building on Base.

While Degen focuses on developers interested in building in Farcaster and Degen Chain, Pandora is looking for developers interested in ERC-404 technology for their collections and memecoins.

“Different community members review applications, so it's important to have a clear vision of how the grants will enhance relevant ecosystems. Important and innovative ideas are encouraged,” an anonymous member of the Seamless Community Giving Program (SCGP) told Cointelegraph.

New support submissions are available through the community management platform. Applicants must fill out a form detailing their projects and specific needs.

Another round of grants is around the corner, this time from the SingularityNET ecosystem. Decentralized Artificial Intelligence's Deep Funding Round 4, which will provide more than $1 million in capital, is expected to be announced in early May.

While grants can be a valuable resource for new projects and developers, a more hospitable funding environment for crypto startups is also emerging. During the first quarter of 2024, investment in crypto companies increased by 38%, and the number of projects receiving funding grew by 49% – the highest since the fourth quarter of 2021.

In March alone, more than $1.1 billion was invested in 180 crypto-related projects, an increase of 52.5% month-on-month, mainly focused on infrastructure and decentralized finance projects.

Among April's headlines, Paradigm led a $225 million round in layer-1 protocol Monad Labs, while Auradin, a crypto mining hardware provider, completed an $80 million Series B funding round.

In this edition of Cointelegraph's VC Roundup, we feature startups that raised capital in the first weeks of April.

AI-blockchain platform Sapien has raised $5 million in a seed round.

Artificial intelligence data mining startup Sapien has received a $5M seed investment from Primitive Ventures, Animoca, Ravikant Capital and Yield Guild Games. In the year Founded in 2023 by Trevor Koverko, formerly of Polymaze, Sapien aims to solve an AI bottleneck: data identification. The company uses blockchain technology to implement gamification on data logging and rewards different people for producing high-quality work. The global labeling market is currently valued at around $3 billion and is mainly dominated by labeling farms in developing countries. “This funding will allow us to expand our team, expand our front-end infrastructure and provide better quality data,” Coverco said in a statement.

Ribbit Capital Leads $10.6M Funding for Alpine Labs' Bitcoin-Based Economy

Bitcoin Layer-2 developer Alpine Labs has successfully raised $10.6 million to leverage Bitcoin's blockchain scalability using zero-knowledge proofs. Emerging from stealth mode, Alpen Labs aims to introduce smart contract functionality to Bitcoin through its bundled infrastructure. The funding round was led by Rabbit Capital and saw participation from Castle Island Ventures, Robot Ventures and Axiom Capital. The startup, which began its journey nearly two years ago, focuses on creating a programmable and scalable layer for Bitcoin, supporting on-chain financial applications including payments, lending and stablecoins. The team has veterans from Blockstar Research, Nethermind, Aleo and Palantir, building an ecosystem for applications to settle transactions via Bitcoin.

Node sales generated $8M for Ethereum Layer-2 HYCHAIN

Layer-2 decentralized network for gaming HYCHAIN ​​collected 2,098 Ether (ETH) worth more than $8 million in 48 hours. The protocol uses a business model that allows community members to earn rewards for operating software nodes. Participants will receive 25% of transaction fees indefinitely for contributing to network security. According to the forum, 16,876 node keys were generated with 3,357 unique cases. The HYCHAIN ​​mainnet was launched on March 9, offering several features and bridges to connect to the Ethereum and Polygon networks.

Web3Firewall raises $2.5M in pre-seed funding.

Web3Firewall has completed a $2.5 million pre-seed round of funding led by Laser Digital – Nomura Digital Asset subsidiary Gumi Cryptos Capital and Susquehanna International Group member SPEILLLP. In the year Founded in 2023 by former Chief Information Security Officer of BitGo, Dr. Sameer Faisal, the company offers an integrated risk and compliance platform designed for blockchain and digital asset companies, specifically targeting organizations operating in decentralized finance (DeFi), non-fungible tokens (NFTs) and decentralized autonomous organizations ( DAOs). According to the startup, the platform will go live in the second quarter of this year, featuring real-time threat detection, prevention and response powered by AI and machine learning.

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