Framework Labs, a fintech studio for the rapidly emerging “Decentralized Finance” or “DeFi” industry, has closed an $8 million seed round of financing led by investment firm Station 13. Framework Labs is a first of its kind fintech studio for DeFi; a full-stack partner to bootstrap the decentralized protocols reinventing finance. Its creators are the founders of Framework Ventures, the DeFi venture fund best known as the largest holders of decentralized oracle network Chainlink ($2.5 billion market cap) and crypto-backed, synthetic asset platform Synthetix ($380 million market cap) aside from core development teams.
Founded in early 2019 Framework Ventures helped provide early-stage capital to the then-nascent DeFi industry, and the team saw an opportunity to support the emerging class of DeFi primitives with more than just venture capital with Framework Labs. The seed funding enables Framework Labs to grow its research, trading and engineering teams, craft governance proposals for DeFi blockchain protocols, provide liquidity to non-custodial decentralized exchanges, incubate promising startups, and build consumer-facing applications on top of protocols that Framework Ventures has backed.
Framework Labs has quietly expanded operations over the last year to become arguably the largest DeFi market participant in the industry, helping spur the total market capitalization of DeFi protocols to over $6 billion. Already, Framework Labs has become:
- The largest staker on Synthetix, a protocol for trading and creating synthetic assets
- The largest liquidity provider and market maker on Uniswap, a popular decentralized exchange for Ethereum
- An integral node operator providing the off-chain data that powers DeFi via Chainlink
- The largest provider of staking services for two major blockchains
“DeFi is coming into its own and beginning to achieve product-market fit at scale, yet traditional investors are asleep at the wheel when it comes to the category. It isn’t enough to buy and hold tokens and provide ‘thought leadership’ – DeFi is not a spectator sport. Active participation, governance, building of consumer products, and advanced trading strategies are all part of the complex process of making a DeFi protocol successful. We are at the bleeding edge of this financial technology,” said Vance Spencer, Co-Founder at Framework Labs.
With its funding, Framework Labs announced two strategic hires to lead the Labs initiative: Ray Pulver, former Co-Founder and CTO of IDEX, the world’s first real-time decentralized exchange; and Roy Learner, former Principal at Wavemaker Partners, a VC fund with $265 million in assets under management.
Co-founder Michael Anderson added, “We’re exceptionally proud to unveil Framework Labs, the manifestation of Framework Ventures’ Network Capital thesis: that alpha will be generated as much by hard work during network maturation as it is by picking winners early. To that end, the Framework Labs fintech studio will shape the way rising DeFi protocols function, bootstrapping liquidity for new projects, building retail-friendly tools, and staking to earn steady cash flows that stack atop themselves.”