- Set Labs is an upstart platform for creating structured DeFi investment products on Ethereum
- They managed to haul $14 million in funding
- Cryptocurrency venture capital Hashed and budding token fund 1kx led the fundraising
Crypto venture capitalist firm Hashed and token fund 1kx led the round. Series A will help Set Labs decentralize its protocol. Alongside them, Set Labs welcomed new as well as existing supporters such as Mechanism Capital, Defiance, Spartan, ParaFi, Coinbase Ventures, Craft, Threshold Ventures, and long-term Set community members.
Alongside this, Felix Feng, who is the Chief Executive Officer, said that the funds will be used in increasing the number of its multi-coin investment vehicles. These will be considered as crypto-native, exchange-traded funds or ETFs and will range from four to 20.
They have managed to manifest their mission through the Index Coop, which is Crypto’s Blackrock, that provides decentralized exchange-traded products or ETPs such as the DeFi Pulse Index, Metaverse Index, and the ETH 2x Flexible Leverage Index. Since the inception, they have seen growth with TVL reaching $400M, and the development of a robust community alongside the cultivation of significant ties with the ecosystem partners as well as the fostering of trusted brands.
Then they have the Set Protocol, which is Stripe for Asset Management that provides an asset management infrastructure for anyone that is looking to launch an ETP or delegated management solutions. In fact, Index Coop, Ember Fund, Yam Finance, and others use Set for many use cases such as social trading, structured product creation, and treasury management.
Lasse Clausen, Founding Partner at 1kx had the following to say “Asset management is a core component of financial services, and Set Labs approaches the problem space with a highly crypto-native and community-driven approach. Set has been able to attract some of the brightest product contributors in DeFi to their communities, which we believe is key to establishing a long-lasting competitive advantage.”
Furthermore, the Set Labs CEO said that for a start-up that has “seen its protocol’s tokenized portfolios which are kind of like ETFs balloon to $400 million in value”, attaining full decentralization of the protocol is a critical point.
He pointed out that, for projects such as them, the more customers they end up acquiring, the more decentralized they have to be. Feng Estimates Set Labs has somewhere along the range of 20,000 users.
The Future of Set Labs
Experts say that the goal of the start-up implies that projects seek to copy traditional financial services, such as borrowing, lending, and trading but want to do them without the downside as well as baggage that comes with a centralized solution.
Feng said: “What we aim to be is the BlackRock of crypto.”
To get there, however, they have homed in on portfolio development. The protocol allows users to gain exposure to many coins, through purchasing a single token, and there is the UNI-heavy DeFi Pulse Index, the Metaverse Index long on tokens from virtual worlds as well as a pair of leveraged products. Everything is non-custodial, with the cash of the investors pooled into a single contract.
Furthermore, the DeFi Pulse Index (DPI) which has had a market cap at $140 million, is Set’s oldest and most popular portfolio according to Feng. Most of their portfolios have spiked from $30 to $50 million in total value locked (TVL) throughout the 2020 DeFi summer to $400 million today.
Set Labs will advance its mission through continuing the decentralization of its protocol as well as furthering community ownership and through building and innovating on the suite of financial products on offer by Index Coop. They also plan to partner with more asset management businesses to deliver end-to-end solutions and enable a higher level of use-cases as well as increased accessibility through L2 and alternative chain developments.