Peter Thiel-backed Layer N raises $5m seed round

Blockchain startup Layer N raised $5m in a seed round led by Peter Thiel’s Founders Fund and the decentralized investment group dao5.

1/ We’re incredibly excited to announce our $5M seed round led by @foundersfund and @daofive, alongside other major funds and angels.

This round marks our first milestone towards building Ethereum’s financial superlayer.https://t.co/yvXQLpP6qT

— Layer N ? (?Singapore) (@LayerN_Official) September 13, 2023

Among others: Kraken Ventures, Amber Group, SALT, and a number of private investors.

For Founders Fund, Layer N’s crypto project became the second investment in the industry after bringing on board in April a new partner Joey Krug — the former co-head of investments at Pantera Capital.

Peter Thiel’s firm contributed $1.8m of the total, while Krug also participated in the funding as a business angel.

The startup is developing a Layer-2 blockchain built on Ethereum, aimed at scaling decentralized finance applications.

According to Krug, Layer N’s long-term goal is to allow centralized exchanges such as Binance and Coinbase to offer non-custodial offerings on the L2 network.

This is intended to address the loss of user trust in CEX, which arose after the FTX collapse. In the investor’s view, the way out is to launch decentralized versions built on Layer N’s solution with an interface familiar to clients from the industry’s biggest players.

In November 2022 the startup announced funding from FTX Ventures shortly before the group filed for bankruptcy. The team planned to build its blockchain on Solana.

Layer N co-founder Dima Romanov said that the capital was never used, and the team decided to move to the Ethereum ecosystem. The reason, he said, was that most institutional investors and liquidity providers gravitate toward this network, he said.

In the second quarter Web3 startups raised about $1.8bn in venture funding — a figure down 76% from the same period in 2022.