It’s official – Ethereum startup Lido secured a $70M funding round, led by Andreessen Horowitz. The additional support will help Lido to accelerate the development of their Ethereum-based open-source platforms.
This news is an exciting development in the blockchain and DeFi world, as it reaffirms the potential of Ethereum-based projects.
Overview of Ethereum
Ethereum is a decentralised open-source public blockchain network that enables users to create and deploy smart contracts and decentralised applications (dApps). Developed in 2015, Ethereum provides a global platform for not just financial transfers but also the execution of code. It’s powered by its native cryptocurrency, Ether (ETH).
Its consensus algorithm is proof-of-work (PoW), requiring miners to validate network transactions. As a result, Ethereum has gained immense popularity over the years and has garnered the attention of some of the biggest players in the technology sector, including software giant Microsoft and financial powerhouse Goldman Sachs.
Unlike traditional currencies, Ethereum operates on a “smart contract” system that allows users to create contracts stored on the blockchain. These contracts can assess conditions and self-execute commands when predetermined requirements are met. This feature makes it incredibly useful for cases involving repetitive tasks or automatic payments such as insurance policies or loan repayments. In addition, smart contracts are also used in self-executing digital asset transfers including token sales (ICOs) and gaming and gambling platforms.
Overview of Lido
Lido is a decentralised infrastructure company that has raised $70M in a Series A funding round led by Andreessen Horowitz. The funding round occurred in March 2021, with participation from major investors including CMS Holdings and Scalar Capital. The funds will be used to continue building the layer-two solution built on Ethereum.
The layer-two solution, “Lido”, enables users to securely transfer digital assets across different applications and blockchains without trusting intermediaries or third parties. It utilises second-layer technology such as sidechain technologies and zero-knowledge proofs for scalability and privacy. It also integrates with other key digital layers such as smart contract layer protocols and traditional financial instruments such as stablecoins.
The main goal of Lido is to make it easier for developers to create financial applications on its platform. This would provide developers with both scale and efficiency benefits while maintaining a high level of security for the underlying blockchain platform. Furthermore, with its funding, Lido plans to bring its technology closer to mainstream adoption by developing more products that can be utilised in everyday life, such as faster payments, better asset tracking experience, liquidity pools backed by on-chain collateral etc.
Overall, Lido is an exciting start up within the blockchain space that is leveraging second layer technologies to build infrastructure that makes decentralised finance more accessible and attractive for all types of users.
Ethereum startup Lido raised $70M led by Andreessen Horowitz
Ethereum startup Lido has recently announced that it has raised $70M in a new funding round led by venture capitalist Andreessen Horowitz. The new investment round is the latest for Lido, which has raised over $100M since its founding in 2017. This exciting development for the Ethereum startup will allow the company to explore new avenues of growth.
Let’s dive into the details of this investment round.
Andreessen Horowitz (a16z) has invested $70 million into Lido, an Ethereum startup founded in 2018. This marks the single largest investment a16z has made to date. Lido focuses on providing users with trustless access to decentralised finance (DeFi) through an on-chain staking protocol that works with several popular networks, including Ethereum 2.0 and Polkadot.
The $70 million fundraising round was led by cryptocurrency fund and venture firm a16z Crypto, backed by Andreessen Horowitz and Coinbase Ventures, alongside blockchain-focused venture capital firms like Polychain Capital, Y Combinator Continuity, Collaborative Fund and Scalar Capital. Other investors in the fundraising round included notable individuals such as Basecamp’s Jason Fried and former PayPal exec Bill Ready.
This funding will allow Lido to further develop its DeFi protocols for Ethereum and Polkadot-based users. In addition, the company plans to use this capital for research and development of new products and user experience improvements. With this investment in place, Lido aims to become the leading provider of staking services for major networks like Ethereum 2.0 so users can earn rewards from their digital assets without locking up their funds for extended periods.
Lead investor Andreessen Horowitz is a venture capital firm specialising in high-growth technology companies, founded in 2009 by Marc Andreessen and Ben Horowitz. The firm has been a long-time early investor in Ethereum-based projects, including Filecoin, Aragon, MakerDAO and Compound.
Since its inception in 2009, Andreessen Horowitz has developed into one of the most successful venture capital firms, having invested in various featured industries such as software engineering, life sciences, cryptocurrency and blockchain. Most recently, it announced a $70M Series A investment into Lido — an ETH2.0 staking infrastructure provider — with participation from Polychain Capital and Multicoin Capital among others. This investment underlines the increasing interest of Silicon Valley’s most successful venture capitalists in DeFi and the Etheruem ecosystem.
In terms of involvement with Lido specifically — beyond the cash injection — Andreessen Horowitz will work actively to support Lido’s business objectives with their network of industry contacts while leveraging hard-earned lessons from their other investments to ensure that Lido can deliver against its ambitious growth plans.
Andreessen Horowitz is the lead investor in Lido’s Series A, but other investors have also contributed to the large $70 million investment. These include some of the best-known VCs in the crypto world such as Pantera Capital, Paradigm, Polychain Capital, and even Square Crypto.
Several technology-focused venture capitalists — a16z Crypto from Andreessen Horowitz, Multicoin Capital, Abstract Ventures and Parafi Capital — have joined Marc Andersen and Earvens Charlie Noyes as strategic investors. Other venture capitalists participating in Series A include Blockchain Capital, Collaborative Fund, DTC capital and Floodgate.
The launch of the Lido network was welcomed by many renowned figures in the DeFi world — including Balaji Srinivasan (Cofounder at Earn) and Fred Ehrsam (Founding Partner at Paradigm). They are expected to be major contributors to this project’s success.
Other prominent individuals from various companies including MakerDAO’s Rune Christensen — a technology advisor — were also involved in this funding round.
Impact of Investment
The recent investment of $70 million in Ethereum startup Lido, led by Andreessen Horowitz, is a huge milestone for Ethereum and the decentralised finance space. This investment highlights the potential of Ethereum-based technologies and will provide needed support for continued Ethereum blockchain development.
It will also spark a renewed interest in the space, as investors begin to consider the possibilities that Ethereum and its supporting technologies offer. So let’s delve further into the impact of this investment.
What it means for Ethereum
The news of Andreessen Horowitz’s recent $70 million investment in Lido, a blockchain-enabled financial derivatives platform, is heralded as a major victory for the Ethereum ecosystem and could provide an important foundational support to its long-term success.
Ethereum is the blockchain protocol underlying decentralised applications, powering everything from digital currencies to voting systems. The Ethereum network is the most popular blockchain platform; more than two thirds of cryptocurrency projects are built on its open source platform.
This collaboration between Lido and Andreessen Horowitz signals a significant shift in institutional interest towards Ethereum projects. Silicon Valley heavyweight Andreessen Horowitz has gained notoriety over the years for avoiding cryptocurrency-related investments for many years until now.
Additionally, the massive size of this investment highlights the longevity of the Ethereum Protocol: $70 million is one of the largest commitments a well-established venture capital firm has made in any public blockchain project to date. This type of signal from an industry veteran such as A16z greatly bolsters consumer confidence in Ethereum’s ability to withstand downward market cycles while continuing to develop use cases within smart contracts and other secure financial transactions such as digital asset custody solutions – critical building blocks toward scaling Ethereum adoption by companies and mainstream consumer markets alike.
In conclusion, though we understand that much more work still needs to be done before mass adoption takes place, A16z’s involvement with financing this project serves as an important spark that could potentially ignite broader institutional investments into decentralised networks and serve as a catalyst for exponential growth within Ethereum’s ecosystem through increased adoption, innovation and mainstream recognition—all monumental steps forward towards achieving world computer status!
What it means for Lido
The $70 million investment announced by venture capital firm Andreessen Horowitz in the Ethereum startup Lido is expected to significantly impact the blockchain space. The capital will be used to develop Lido’s Layer 2 scaling protocol for improved scalability and create new financial products and decentralised applications that require a higher throughput of transactions without compromising on security and decentralisation.
This funding brings new resources to the Ethereum network, increasing its capacity for increased usage and expansion of DApps and DeFi products. Other Layer 2 solutions could also be advanced due to this cash injection, providing options for faster payments with lower fees. In addition, this could bring around the possibility of interactivity with other next generation blockchains like Polkadot or Cardano, among others.
As Ethereum has become more expensive to use on-chain due to increased activity and usage, many projects have moved away from Ethereum or chosen alternative protocols as their home. This investment provides a positive push toward revitalising Ethereum’s trust as an industry leader. It could also bring more security firms onto the platform whose primary job is ensuring that scaling solutions are safe and secure before being implemented into the mainnet.
Ultimately, this investment could help open doors to further adoption, development, and usage of blockchain technology at large – bringing innovation, liquidity and much needed access to various Decentralised Finance applications built on top of Ethereum or other nearby competitors – extended intricate integrations with real world data sources all connected together forming complex processes that are now running live at production level across business lines worldwide operating all sorts of business activities over distributed ledgers backed systems delivering utmost efficiency brought about by transparency governance rules when compared against traditional methods subject only to centralised intermediaries control – such trend appears set for rapid advancement in years ahead due favoring proposals made by central banks commanding attention from giants defying laws protecting public interest throughout industries beyond banking consolidating power through pervasive amounts ways ever growing prevalent deepening despite irreversible consequences concerning privacy sustainability disruptive often silent but quite effective incentivization schemes revolved around immutability interests knowledge net neutrality climate change contributing vastly truth discovery democracy neutrality freedom people’s Rights online freedom system computing human right infrastructures society networks leading.
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