A venture fund that invests in early stage founders seeking to build trusted new financial systems.

Department of XYZ

We Back Founders  Building Trusted New Financial Systems

etherfuse recently announced a $3M seed funding round to bring emerging market debt on-chain. The round was co-led by White Star Capital and North Island Ventures. We are proud to participate. 

While analyst reports tend to focus on the operational benefits of tokenized real world assets, such as lower costs and greater speed, they often miss a more significant opportunity: new markets. Tokenization of real world assets is not only about improving the assets themselves, but also about making markets more global and accessible to all -- an opportunity etherfuse was early to spot.

etherfuse has already launched five products so far. These include tokenized sovereign debt, “Stablebonds,” issued by Mexico 🇲🇽 and Brazil 🇧🇷. They also recently announced the creation of a new Mexican Peso-denominated stablecoin called MXNe. Yield opportunities in DeFi today range from the rock solid safe yields of US Treasuries (the 1 month US Treasury rate is currently around 5.5%) to less sustainable degen yields that sometimes exceed 30.0%. Etherfuse provides a new set opportunities. For example, the current rate for Mexico’s 28-day bond offering sits at 10.89%.

Read our blog post to learn more about etherfuse and why we are so excited about this investment opportunity.

Today Mountain Protocol announced their Series A funding round. We were proud to participate. Read on for our thesis on this opportunity.

Having achieved clear product market fit we believe stablecoins are well on their way to becoming a core infrastructure for the payment systems of the future. We believe Mountain Protocol is positioned to dominate three areas of critical importance in the stablecoin issuance market:

- Regulated: Mountain Protocol has been regulated and supervised by the Bermuda Monetary Authority (BMA) since July 2023, a globally respected regulator that has developed one of the most robust regulatory regimes for digital asset companies.

- Yield-Bearing: Mountain Protocol is also unique in that it shares the yield it generates from its reserves with stablecoin (USDM) users. As of writing, USDM holders are receiving 5.00% APY in locations where Mountain Protocol is accessible.

- Global Focus: We see some of the most meaningful real-world adoption of stablecoins in markets outside of the United States. This is an enormous business opportunity that Mountain Protocol is particularly prepared to execute on. 

Check the comments below for our full blog post on why we invested.

Last week we announced our debut venture capital fund for The Department of XYZ. ICYMI you can read Leo Schwartz's feature here: https://lnkd.in/eJ7kA64R. 

Today I wanted to share more information about how you can follow our progress:

💻 Website: https://lnkd.in/eGMA7Tn6
✉ Newsletter: https://lnkd.in/eXsx3GS9 (sign up for monthly-ish updates)

Also, if you are in Austin for Consensus, please join us for our launch party on May 29: https://lnkd.in/etXK7aRM.  

I'm fortunate for the many friends and colleagues, new and old, who have invested their capital to make this possible. And I'm grateful for the opportunity to support those founders who are working to build a better financial system. 

Thank you 🙏

Former New York State Department of Financial Services crypto regulator Matthew Homer raised $5.1 million for Department of XYZ, a blockchain-focused venture fund with a who's who of backers, including Robert Leshner, Kyle Samani, and Tyler Winklevoss and Cameron Winklevoss. 

"We’re not going to be your largest check, but what we are going to be is your regulatory friends on speed dial," Homer told me.

https://lnkd.in/gFv8XTJV

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