📝Field Notes #43: Let's Get Physical

Nike gets real with NFTs. Pudgy launches in the UK. Crypto's global chess game unfolds. Kraken enters EU. Q3 fundraising dips. IYK secures $17m from a1 for digi-physical future. Top charts & more.

Oct 06, 2023

Hey, it’s Marc. Welcome to my weekly, obsessively curated field notes on crypto & Web3 to help you filter out the noise. ✌️ PS: I’ve got free ad spots.

⏱️ Reading time: 4 min

Be inspired✨

“Wheresoever you go, go with all your heart.”― Confucius

📚 Top 5 Reads

Mapping The New Internet. By Joel John and Siddharth. Link
The Barrier to Mainstream Crypto Adoption Isn’t UX — It’s Product-Market Fit. By Li Jin. Link
The Creator Economy 4.0. By Only1. Link
Web3 Could Change the Business Model of Creative Work. By Alex Tapscott, HBR. Link
Crypto’s First Year After the FTX Blowup: ‘It’s Been Miserable’. By Michael P. Regan & Anna Irrera, Bloomberg. Link

🚨 Top Stories That Caught My Eye

✨ Web3 + NFTs

Let's get physical, physical 👟👜🐧

Nike’s Web3 team announced its first physical sneaker called Air Force 1 Low “TINAJ”, which stands for “This is not a jpeg.”
TINAJ will drop in November to .SWOOSH ID NFT holders who purchased and revealed an OurForce 1 box (don’t know what this is? Read the full case study).

Zooming out: Other brands with recent digital-to-physical activations include Gucci’s Material NFTs, rewarding NFT holders with exclusive bags, or Louis Vuitton’s VIA Treasure Trunks.

Funded. Last week, IYK, a NY-based startup focusing on digi-physical experiences with NFTs, raised $17m from a16z crypto. 👀

Punchline: It’s an obvious next step for brands to offer more physical products and experiences to its NFT holders. Nike could even bring the most popular co-created .SWOOSH designs into its global retail stores. Owning a brand’s virtual products might become a top-of-the-funnel gateway drug for next-gen consumers, who spend more time online to create, earn, and hold virtual assets.

🌎 Crypto & Macro

US crypto companies go global🌍

Kraken is acquiring Dutch broker Coin Meester and receives key European licenses according to reports; the CEO called the Netherlands a “key market”.

Zooming out: Crypto's global chess game:

Galaxy Digital, one of the biggest digital asset service-providers for institutional investors, recently announced its expansion to Europe and a16z crypto opened a European office.
Coinbase CEO said leaving the US for UK is “on the table” back in April. This week, it secured a payment license in Singapore and received licenses from Spain and Bermuda last week.

Punchline: Enhanced regulatory clarity in Europe through the MiCA framework, coupled with ongoing legal battles in the U.S., has tilted the global balance in favour of other jurisdictions. Hubs like Dubai, Singapore, London, and Hong Kong are actively competing to attract crypto startups.

Bear with me: Crypto fundraising dips 36% in Q3💸

Overall Q3 fundraising hits $2.1 billion in 297 deals, down 36% from last quarter; deal count was down 6% (288) from Q3 (306).
Early-stage deal share grows to 48%, while strategic funding grows to 22%.

Bullish. Meanwhile, a16z crypto invested over $70m just in September (IYK, Freatic, Bastion, Story Protocol).

Punchline: In a bear market, the game's not over. It's just changing. With both deal count and funding down YoY, investors are focusing on early-stage ventures and strategic plays.

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💰 Money Moves

IYK, a NY-based startup focusing on digi-physical experiences with NFTs, raised $17m from a16z crypto. Link
Supra raises $24M for its cross-chain oracle network. Investors include Animoca Brands, Coinbase Ventures, and Valor Equity Partners. Link
Deus X Capital launches new $1B firm focusing on digital assets, blockchain, fintech, and more. Link
CMCC Global raises $100m to launch Hong Kong Web3 fund for early-stage blockchain startups in gaming, metaverse, and NFT sectors. Link