Episode 89 of Season 4 of The Scoop was recorded live with The Block's Frank Chaparro, CoinShares CSO Meltem Demirors, and Aglaé Ventures' Managing Partner Vanessa Grellet.
Last year’s bull market exuberance is a distant memory, as are the wildly inflated crypto funding rounds that attracted an unprecedented amount of venture capital to the space.
In this episode of The Scoop, CoinShare’s Chief Strategy Officer Meltem Demirors and Aglaé Ventures Managing Partner Vanessa Grellet unpack how the crypto VC landscape has changed since last year’s bull market, and particularly why venture capitalists are becoming more reluctant to invest in early token rounds.
As Demirors explains, savvy investors are realizing the token model is not always the best way to capture value:
“There's now consideration of the fact that tokens, in particular governance tokens, are not necessarily the best way to capture value creation… an investor who's willing to write really large checks is going to have some fundamental questions around monetization that doesn't just rely on ‘number-go-up’ tokenomics.”
According to Grellet, regulatory concerns — particularly regarding some token models’ similarity to unregistered securities — are another reason tokens are not as attractive to investors these days.
While hesitancy regarding seed-stage token rounds is becoming more widespread, Grellet believes there is still interest in tokens if they make sense as part of larger equity investments:
“We see a lot of investors being comfortable with both the equity and a token option so that if the main company has one project, but also has several other projects that warrant tokens, then you can have upside in the ongoing life of the company.”
During this episode, Chaparro, Demirors and Grellet also discuss:
- The bull case for crypto custody and infrastructure products
- Why DeFi is still in its early stages of development
- How ‘computational finance’ will change the world
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