Crypto VC Firms Are Plowing Millions into “Professor Coins” Despite Centralization Concerns
Crypto VC firms have increased their investments in the market this year despite fundamental blockchain concerns. A new Bloomberg report shows the flow of fundsProfessor Coins,” Virtual asset projects sparked by college professors.
Firms founded by academics received millions from venture capital firms as the market recovered, according to the report. The inflows come on the heels of renewed investment in the first quarter of 2024 after Bitcoin (BTC) surged to an all-time high above $72,000.
Companies such as CheckSig and Sahara were founded by university academics and have registered entries in the last two months.
Crypto VC Firms Are Restocking
The return to professor coins has brought significant inflow to firms offering restocking services. Restaking allows validators to trust assets that have already been staked. This makes room for new projects, which is why getting a head start by borrowing resources.
Crypto VC firms garner attention ÖzKatman and Babylon saw $118 million flow into both projects recently. Founded by Sreeram Kannan, a professor at the University of Washington, the company received $100 million in funding from Andreessen Horowitz. Babylon Founded by Stanford University Professor David Tse, the project has raised $18 million.
Riad Wahby, an engineering professor at Carnegie Mellon University, noted the research and benefit of both projects to the industry. “They have thought of many such repurposing technologies. I mean, it’s kind of their baby, so it makes sense. And I think more and more of this technology will come from research.”
Kate Lawrence, Chief Executive Officer of VC firm Bloccelerate, said academic background can be unflattering as professors tend to focus on theory rather than practice. However, the company invested in both projects with a re-share model.
Centralization Concerns
Crypto VC firms’ transition to professor coins is not without industry criticism, as many note the decline of decentralization. This follows EigenLayer’s token launch plan to distribute 1.67 billion tokens, with more than 50% going to early participants and investors.
The coins will also be partially non-transferable, causing concerns. The team explained that making it non-delegable allowed time to improve decentralization.
So read: FED Starts Silently Printing Money, Bitcoin Price Rises
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