KuCoin Ventures Weekly Report 20250421-0427
2025/04/29 01:13:17
KuCoin Ventures Weekly Report: Corporate SOL Reserves Rise, Tariff Tensions Ease, BTC ETF Daily Inflows Hit 3-Month High, and the Struggle and Development of Modular Public Chains/DeAI Infrastructure
1. Weekly Market Highlights
From BTC to SOL: Traditional Companies Increasingly Add Solana to Their Corporate Treasury Strategies
Integrating crypto assets into corporate balance sheets is no longer a novelty. Following the example set by BTC, MicroStrategy pioneered the move by acquiring a large amount of Bitcoin as its primary treasury reserve asset, even financing additional purchases through convertible bond issuances. During specific market cycles, this strategy not only served as an inflation hedge and a pursuit of higher financial returns but also significantly boosted its stock price, creating a mutually reinforcing dynamic between BTC and corporate value. This laid the foundation for the wider acceptance of crypto assets within corporate asset management.
However, as BTC has increasingly gained recognition as "digital gold" and its price movements have become less volatile, the potential for outsized Alpha returns has diminished, shifting its role more towards offering Beta exposure aligned with broader macroeconomic and market sentiment trends. Against this backdrop, Solana (SOL), with its higher risk and growth potential, has emerged as a new favorite for companies seeking greater upside.
New Forces: A Dual Embrace by Investment Institutions and Traditional Corporates
Before mainstream operating companies entered the space, investment firms with closer ties to the crypto industry were already making moves. Canadian investment funds such as SOL Global Investments and Sol Strategies had already accumulated significant SOL holdings—over 260,000 tokens each by 2025. Beyond holding SOL, they actively participated in staking and investing in the broader Solana ecosystem. This early involvement reflects a strong vote of confidence from professional investors in Solana’s long-term value.
The real turning point signaling SOL’s entry into mainstream corporate consciousness, however, came with the involvement of companies outside the crypto sector. Consumer goods company Upexi (Nasdaq: UPXI) announced a $100 million private placement, led by crypto trading giant GSR Markets, with plans to allocate $94.7 million to purchasing SOL and establishing a corporate treasury reserve. Similarly, fintech firm Janover (Nasdaq: JNVR), faced with a sluggish real estate market, declared plans to add approximately 164,000 SOL tokens to its holdings, raising its total to about 317,000 tokens. Their funding sources included both cash reserves and convertible bonds raised from Pantera Capital, Kraken, and other prominent crypto institutions. This cross-industry move suggests that SOL is expanding from the crypto-native world into a broader corporate asset allocation landscape.
BTC as Beta, SOL as Alpha: A New Logic for Corporate Asset Allocation
For relatively smaller, higher-risk-tolerant companies like Upexi and Janover, holding SOL represents a classic Alpha strategy: betting on the Solana ecosystem’s expansion across DeFi, DePIN, and other sectors, while aiming for greater price elasticity and higher returns compared to BTC. Fundamentally, this is a bet on Solana's future growth potential, binding part of the company's future value to the network’s success in the hopes of delivering superior shareholder returns.
However, positioning SOL as a corporate treasury asset also entails significant risks. First, SOL’s price volatility far exceeds that of BTC, posing substantial financial stability risks. Second, Solana's network has previously encountered outages and other infrastructure challenges. Furthermore, global crypto regulatory policies remain uncertain, leaving companies vulnerable to potential compliance shocks. More practically, traditional firms may lack the internal capabilities needed to securely manage and effectively utilize such highly volatile assets, exposing them to operational and execution risks.
Overall, traditional companies increasing their SOL holdings marks an emerging and noteworthy trend. It reflects growing institutional confidence in the potential of emerging Layer 1 ecosystems and signals a broader search for new growth drivers beyond BTC’s established narrative. However, at this stage, it remains a high-risk, high-reward frontier experiment rather than a fully validated mainstream trend—one that will require more time, more examples, and more regulatory clarity to truly mature.
2. Weekly Selected Market Signals
BTC Surges Back to $95,000, Amid Tariff Relief, BTC ETF Inflows, and M2 Fake News...
Over the past week, BTC climbed approximately 10,000 points, briefly reclaiming $95,000. The primary driver was the easing of U.S.-China tariff tensions and a perceived de-escalation of the trade war. After rounds of retaliatory tariffs, U.S. officials last week signaled potential tariff relief, with the Treasury stating that the tariff standoff with China is unsustainable and expressing no intent to decouple from China. The White House indicated progress toward a U.S.-China agreement, and Trump stated he has no plans to remove Fed Chair Powell. These developments bolstered the U.S. dollar and stock futures, with BTC riding the wave of optimism. However, "easing" and "de-escalation" do not mean resolution. Despite the U.S. signaling positive tariff news, China has consistently denied engaging in negotiations, leaving long-term tariff and trade uncertainty intact. BTC continues to behave as a risk asset, closely correlated with U.S. equities.
Positive policy signals translated into real buying power, with institutional investment via BTC ETFs significantly driving the price surge. Last Thursday and Friday, BTC ETFs recorded their highest daily net inflows in the past three months.
Notably, amid the bullish sentiment, a TradingView chart circulating on CT, showing a sharp rise in Global M2 money supply alongside BTC’s price trend, went viral. Influencers proclaimed that BTC could soon reclaim $100k or even soar to $200k, sparking excitement in the community. Historical data suggests a positive correlation between Global M2 money supply (total global cash + bank deposits + easily accessible money) and BTC’s price, with BTC typically lagging by about two months. This is attributed to increased liquidity gradually flowing into and boosting the price of the fixed-supply BTC. However, the reported surge in Global M2 was driven by a supposed 1,000% spike in India’s M2, which turned out to be a data error on TradingView.
This week, three projects with funding rounds exceeding $10 million were announced, one each in the Ethereum, Bitcoin, and Solana ecosystems
Symbiotic secured a $29 million Series A round led by Pantera Capital, with participation from Coinbase Ventures
Following this round, Symbiotic’s total publicly disclosed funding reached $34.8 million, with its previous seed round led by Paradigm. Symbiotic introduced a universal staking framework aimed at enhancing security through staking, allowing L1 or L2 tokens to be used as collateral. Currently, Symbiotic’s TVL stands at $880 million, making it the third-largest protocol in the restaking sector, though it lags significantly behind EigenLayer’s $7.98 billion and Babylon’s $4.68 billion. Symbiotic’s staking framework is similar to EigenLayer’s AVS, essentially providing shared Ethereum mainnet-level security to other networks or protocols in exchange for rental income, falling within the infrastructure category. However, a notable issue is the oversaturation and homogenization of L2 public blockchains. Another challenge is that restaking protocols and various LST protocols’ tokens remain largely utility-less, and users are growing weary of TVL-driven games.
Arch Network raised $13 million in a Series A round led by Pantera Capital at a $200 million valuation
Following this round, Arch Network’s total publicly disclosed funding reached $20 million, with its previous seed round led by Multicoin. Arch Network aims to build a platform on Bitcoin L1 that enables application execution without requiring cross-chain operations. Its core component, ArchVM, is derived from Solana’s eBPF branch and implemented in Rust. ArchVM, alongside Bitcoin’s BitVM and Atomicals AVM, represents a similar concept but with different approaches to enabling smart contracts or application interactions on Bitcoin L1. While the vision is ambitious, the technical challenges are significant. The once-hyped BitVM has faded from discussion, and Atomicals’ core developers have largely stepped back, with the project in a CTO (community takeover) state. Whether Arch can achieve its stated vision remains to be seen.
Nous Research secured $50 million in a Series A round led by Paradigm at a $1 billion valuation
Following this round, Nous Research’s total publicly disclosed funding reached $70 million, with its previous seed round backed by Distributed Global and Delphi Digital, among others. Founded in 2022, Nous Research is an open-source research DAO composed of AI researchers, with some of its papers cited by Meta and DeepSeek. Its goal is to develop open-source models, leveraging Solana as a key component for training these models through token-incentivized distributed training methods. Nous’ GitHub repository has over 2.5k stars. While Nous is unlikely to issue a token, as an AI research organization with notable influence in Web2, its exploration of AI and crypto integration holds promise. It remains to be seen whether it can inject new vitality and innovation into this intersection, moving toward true practical utility.
3. Project Spotlight
Initia Launch: Reviving Modular Concepts? Addressing Rollup Liquidity Fragmentation
In the current market, simply launching another L1 blockchain or L2 Rollup solution is no longer sufficiently compelling. Market participants generally need to incorporate additional narratives—either innovating with liquidity mechanisms, as exemplified by Berachain, or expanding conceptual frameworks through narratives such as AI chains or RWA chains. What factors have contributed to Initia's successful mainnet launch and subsequent Binance listing?
The core value proposition lies in its direct approach to industry pain points. Addressing the fragmentation challenges developers face when navigating diverse virtual machines (EVM, MoveVM, CosmWasm, etc.) and toolchains, Initia has introduced the Interwoven Stack. This framework not only accommodates multiple execution environments but also provides an integrated toolkit designed to significantly simplify Rollup construction and deployment. This enables developers to focus on application innovation regardless of programming language or environment, while ensuring seamless integration between Rollups and the Initia L1.
From a liquidity perspective, Initia's Enshrined Liquidity and Vested Interest Program, somewhat similar to Berachain's POL (Protocol-Owned Liquidity), aggregate liquidity at the L1 level. These programs distribute resources to ecosystem DApps and Layer 2 solutions through market participation incentives, creating a balanced game theory dynamic between developers, DApp users, and INIT token holders/stakers to achieve efficiency and equilibrium between supply and demand.
Nevertheless, Initia faces significant challenges. Projects with chain-level incentive mechanisms are no longer rare; even established protocols like Uniswap require substantial subsidies to attract liquidity following the launch of UniChain. Under a strategy supporting multiple VMs in parallel, ensuring adequate resources and optimization for each environment remains challenging. Additionally, competing for top developers within the Cosmos ecosystem and other VM environments, while also cultivating emerging talent, presents ongoing difficulties.
Initia's innovative approach warrants attention, as its consideration of liquidity issues and developer experience reflects industry-wide concerns. However, the journey from concept to successful ecosystem implementation remains lengthy and challenging. Notably, Initia's team includes former Terraform Labs members Zon and Stan Liu—a project with both legendary achievements and cautionary lessons. Whether Initia can lead its ecosystem partners and restore Cosmos to the flourishing golden era it experienced during LUNA's peak remains to be seen.
FLock.io Partners with Alibaba's Qwen AI Model to Provide Computing Power and Infrastructure
Decentralized AI training platform FLock.io has announced a strategic partnership with Alibaba Cloud to develop vertical domain and general AI models based on Alibaba's Qwen large language model and cloud computing infrastructure. This collaboration represents a relatively rare instance of an official implementation partnership between a Web3 AI project and a Web2 large language model, generating significant market discussion.
FLock.io is a decentralized AI platform that combines federated learning, blockchain technology, and community participation models to balance efficiency, privacy, and collaboration in AI development. The platform's technological foundation is federated learning, which—through its FL Alliance client—allows multiple parties to train models on local datasets while exchanging only model parameters rather than raw data, thereby preserving data privacy. Indeed, Flock's approach through federated learning aligns well with blockchain's capacity to address trust issues when computing power and data are distributed. This alignment has enabled Flock.io to secure $9 million in funding from prominent institutional investors over the past year.
In contrast to MEME AI or AI framework projects that emphasize concepts and user traffic, FLock.io has distinguished itself through practical implementations and collaborations. Beyond its external partnership with Alibaba, it has engaged with crypto-native projects such as Io.net (introducing PoAI to verify computing power authenticity/integrity) and Akash Network (providing streamlined node deployment solutions). Additionally, through products like Web3 Agent and Text2SQL Agent, FLock.io has worked toward implementing the DeAI collaborative network concept. Such implementations and partnerships not only expand its client base but also represent a pragmatic approach to gaining market attention—a strategy worth emulating by other projects.
In the current environment of dispersed market attention, project teams are employing various methods to capture user interest. While numerous projects promote DeAI narrative concepts, relatively few have focused on technical implementation and establishing effective partnerships. The development of the DeAI sector remains in its early stages. Based on the current situation, widespread attention and application of underlying infrastructure in this field may only emerge after truly large-scale consumer DeAI applications appear. At that point, the technical capabilities, service value, and cooperative networks established by various infrastructure projects—beyond concepts and narratives—will become crucial differentiators of their market positions.
FLock.io's partnership with Alibaba Cloud represents a noteworthy case study, though a considerable journey remains between narrative and large-scale application. From a long-term perspective, the market will ultimately evaluate these projects based on actual product performance and user value rather than conceptual speculation.
About KuCoin Ventures
KuCoin Ventures, is the leading investment arm of KuCoin Exchange, which is a top 5 crypto exchange globally. Aiming to invest in the most disruptive crypto and blockchain projects of the Web 3.0 era, KuCoin Ventures supports crypto and Web 3.0 builders both financially and strategically with deep insights and global resources.
As a community-friendly and research-driven investor, KuCoin Ventures works closely with portfolio projects throughout the entire life cycle, with a focus on Web3.0 infrastructures, AI, Consumer App, Defi and PayFi.
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