As the world's leading cryptocurrency trading platform, Binance not only provides trading services, but also provides support and funding for potential blockchain projects through its investment incubation program. These incubation programs not only bring rich profit returns to Binance itself, but also play a positive role in the prosperity of the entire blockchain ecosystem.
1. Positioning and advantages of Binance Investment
Binance's external investments are mainly made through its venture capital and incubation department, Binance Labs. Binance Labs was officially established in April 2018. As Binance's internal venture capital business department, Binance Labs is positioned to discover founders with innovative ideas, support their project construction, and jointly create the future of the Web3 industry. Binance Labs' investments are not limited to specific blockchains and development stages. It provides all-round support and resources for blockchain entrepreneurs and startups, aiming to help early projects succeed through incubation programs.
Binance Labs’ Outbound Investment Advantages
1. Global influence: As the venture capital business unit within Binance, the leading exchange, Binance Labs has a strong reputation and resource support, giving it extensive influence and resources around the world.
2. Potential for integration with the Binance ecosystem: A key advantage for projects that receive investment from Binance Labs is the potential to integrate with the Binance ecosystem and be listed on the Binance exchange. Startups can gain huge exposure and reach a large user base, increasing their potential for success.
3. Value creation services: In addition to financial support, Binance Labs also provides services such as general consulting, operational support, and technology/product joint development. These services can help startups solve various problems and improve their competitiveness and sustainability.
4. Rich resources: As part of the world's largest cryptocurrency trading platform, Binance Labs has rich resources and a huge network. These resources include technology, markets, business partners, etc., providing valuable support and assistance to start-ups.
2. Binance’s criteria for selecting investment projects
When selecting investment projects, Binance focuses on the innovation of the projects, the sustainability of the business model, the market adoption rate, the quality of the team, and the feasibility of the technology. Its strict and comprehensive investment standards and evaluation process provide guarantees for the discovery and cultivation of high-quality projects.
1. Product innovation: Innovation is one of the primary criteria for evaluating projects. Binance first considers product innovation when selecting investment projects, that is, whether the project has built a new model that users will benefit from.
2. Sustainable business and token models: Binance focuses on the sustainability of the project's business and token models, that is, whether the project's business model is profitable in the long run and whether the token incentives are constructed in the right way.
3. Adoption rate: The traction of a project is one of the important indicators to evaluate its value. The number of users of the project, the revenue generated, etc. are all important factors in evaluating the traction of the project.
4. Team quality and persistence: Binance focuses on the quality and persistence of the project team. If the project requires it, whether the team can devote itself to the project full-time, because the stability and persistence of the team are crucial to the development of the project.
5. Technical feasibility: The last evaluation attribute is technical feasibility, that is, whether the technology used by the project is feasible and realistic. Binance will evaluate the technical feasibility of the project based on the project's technical roadmap and what has been built.
3. Binance Investment Channels
In addition to direct investment, the Binance Incubation Program and the MVB Program are two major investment methods provided by Binance Labs for blockchain startups. Both the Incubation Program and the MVB Program are held twice a year. Since their launch in 2021, six sessions have been successfully held and both are currently in their seventh session.
1. Binance Labs Incubation Program
The Binance Incubation Program is a long-term investment approach that is not limited to a specific chain. It aims to provide all-round support and resources to early-stage blockchain startups, promote the growth of Web3 startups, and help founders achieve long-term development and success in an ever-changing industry environment.
Long-term support: The Binance Incubation Program provides long-term support to startups, including financial, technical, market, legal and other support, to help them overcome various challenges in the early stages of their start-up.
Comprehensive services: The incubation program not only provides financial support, but also provides various services to start-ups, such as consulting support, marketing promotion, technical guidance, etc., to help them establish and develop their projects.
Customized support: Binance Incubation Program provides customized support and services based on the needs and characteristics of startups to help them maximize their development potential.
2. The Most Valuable Builder Accelerator Program
MVB is the Most Valuable Builder Accelerator Program initiated by Binance Labs, focusing on BNB Chain and jointly launched with BNB Chain. It aims to provide support for outstanding builders and start-ups that have achieved outstanding results inside and outside the BNB Chain ecosystem. The winners selected from the MVB will receive official donations, technical support and potential investment, as well as the opportunity to be listed on the Binance Exchange main site, to help them achieve rapid expansion and growth.
Short-term acceleration: The MVB program provides startups with short-term acceleration services, usually 8-10 weeks, designed to help them quickly solve problems, optimize business models, and achieve rapid expansion.
In-depth support: The MVB program provides start-ups with deeper support and guidance, including guidance on technology, market, business model, etc., to help them achieve rapid business development.
Concentrated resources: MVB plans to concentrate the resources and professional teams of Binance Labs to provide startups with a full range of support and services to help them achieve greater success in a short period of time.
Starting from the 7th phase in 2024, the Binance MVB Accelerator Program will expand to both startups and founders, and is committed to incubating 100 new ideas on the BNB chain. The startup track focuses on promoting the rapid development of early cryptocurrency projects. The founder track focuses on supporting and incubating builders to help them grow into successful founders.
4. Binance Investment Data Performance
Since its establishment in 2018, Binance Labs' investment portfolio includes more than 200 projects from more than 25 countries on six continents, of which more than 50 are incubated by Binance Labs. According to The Block, as of the first quarter of 2024, Binance Labs has accumulated $9 billion in assets. According to a Binance spokesperson, its theoretical return is more than 10 times the investment amount.
Number of investment projects
As of May 15, Binance has publicly announced 19 investment projects since 2024, with a total amount of approximately US$364 million. Including Zest Protocol, UXUY, Movement, MilkyWay, BounceBit, StakeStone, Cellula, Derivio, QnA3, Privasea, Babylon, Renzo Protocol, Ethena, NFPrompt, Shogun, Analog, Puffer Finance, Memeland, BracketX, etc.
RootData has collected 193 Binance Labs external investment projects, of which 108 have issued tokens and are in operation. There are 65 projects shortlisted for the 1st to 6th phases of the incubation program, and 36 projects shortlisted for the 1st to 6th phases of the MVB accelerator.
Image source: RootData
Binance Investment Layout and Scale
In terms of investment layout, Binance Labs' investment areas are very broad, covering most tracks related to Web3, including public chains, protocols, infrastructure, NFT, blockchain games, metaverse, DeFi and CeFi, etc. Binance Labs pays special attention to infrastructure, on-chain applications, data analysis and security. These areas are not only the core of the development of the cryptocurrency industry, but also the priority investment direction of Binance Labs.
Image source: RootData
Infrastructure: It accounts for the largest proportion of Binance Labs’ investment portfolio, reaching 38.3%, and is the cornerstone of the blockchain and cryptocurrency industry.
DeFi: accounts for 20.7% of the investment ratio, which not only has huge market potential, but also leads the forefront of industry innovation.
Games: Accounting for 16.5% of the investment, it is at the forefront of leading industry innovation.
Web3 related tracks: accounting for about 24.5%, including social entertainment, tools & information services, NFT, etc. These areas are considered to be the next growth point of the cryptocurrency industry.
In terms of investment scale, Binance Labs' investment scale is mainly concentrated in the range of US$1-10 million, with the most concentrated investment amount range being US$1-3 million, followed by US$5-10 million. Binance Labs mainly invests in non-lead projects, with lead investment as a supplement.
Binance Investment Return Performance
In terms of investment returns, Binance Labs' investment in Web3 has supported well-known companies such as Polygon, Optimism, LayerZero, Celestia, Aptos, Mysten Labs and Trust Wallet. According to Chain Broker platform data, there are six Binance investment projects with a return on investment (ROI) of more than 100 times, namely Polygon, Injective, Axie, Sandbox, MultiversX and Merit Circle.
Image source: Chain Broker
5. Inventory of Binance’s hot investment projects
In previous MVB acceleration programs, Binance Labs has invested in decentralized domain name protocol Space ID, Web3 infrastructure Overeality, interoperability communication protocol Multichain Event Protocol (MEP), mobile strategy game Meta Apes, tokenized investment portfolio Velvet Capital, multi-chain open data analysis platform Web3 Go, casual game platform Gameta, Ethereum expansion project AltLayer, perpetual DEX project KiloEx, lending protocol Kinza Finance, and AI blockchain-based virtual companion game Sleepless AI.
On March 1, Binance Labs announced 13 early projects for the seventh season of the MVB Accelerator Program, covering three tracks: DeFi, infrastructure, and application layers. These projects are innovative and have great potential in the fields of blockchain and artificial intelligence, and are worthy of attention.
BitU: BitU is a crypto-native collateralized stablecoin protocol that uses off-chain liquidity and efficiency to provide higher returns. Its Active Liquidity Management Module (ALMM) solves the problem of interest rate differentials between on-chain and off-chain stablecoin lending, and introduces trusted custodians to provide users with safer fund storage and profit distribution.
Blum: Blum is a hybrid CeDeFi exchange where users can trade cryptocurrencies through a Telegram applet. It provides off-chain order books, on-chain settlement, and centralized or self-custody options, while supporting derivatives trading services.
Surf Protocol: Surf Protocol is a perpetual contract trading platform based on Base, providing leverage trading, premarket trading, points trading and other services for low-market-cap tokens.
Vooi: Vooi is a cross-chain perpetual contract DEX aggregator that supports multiple DEXs and allows users to conduct gas-free transactions with a maximum leverage of 100x after connecting their wallets.
Aggregata: Aggregata is a DePIN-powered AI data storage project that creates and prices high-quality data, and users can share, sell, and find AI datasets on its marketplace.
Nesa: Nesa is a lightweight Layer 1 for AI that uses on-chain ZKML to perform highly private, secure, and trusted query execution for AI reasoning. It proposes a privacy-centric decentralized reasoning protocol that commits to the computational reasoning results through a security committee and sends them to the chain.
Nimble Network: Nimble Network is a composable AI protocol that allows AI agents, data providers, and compute resources to combine and use ML models and data. It is creating atomic building blocks for the protocol to scale to areas such as IP, creators, advertising, personalization, and chatbots.
Aspecta: Aspecta is an AI-driven digital identity ecosystem platform that builds an AI-generated identity system, Aspecta ID, for developers and others to demonstrate, connect and explore. It also provides access to exclusive DAOs, ecosystems and applications.
Holoworld: Holoworld is a decentralized AI virtual character market and social platform where anyone can create an intelligent AI robot with just a few clicks.
Opinion Labs: Opinion Labs is a dynamic public opinion and continuous prediction market that has created a full-chain social infrastructure. Its first product is the full-chain opinion market and content community DApp AlphaOrBeta.
Side Quest: Side Quest is a gaming social platform that aims to provide a variety of games, acquisitions, food and communication opportunities.
Story Chain: Story Chain is an AI-powered story-writing NFT application where users can use LLM and image AI to create stories with unique chapters and art and mint them as NFTs.
Tilted: Tilted is a gaming asset marketplace for buying, selling, and trading gaming assets, skins, and NFTs on-chain, enabling cross-game compatibility.
6. Challenges and opportunities of Binance investment
With the support of Binance Labs, many blockchain startups have achieved remarkable achievements. These projects cover DeFi, NFT, blockchain infrastructure and other fields, providing strong verification for the effectiveness of Binance Incubator's investment strategy and incubation methods. With the rise of narratives such as AI, DePIN, and LSD, as well as the rise of ecosystems such as Bitcoin and Solana, Binance Investment faces a series of opportunities and challenges.
Challenges and Problems
1. Regulatory uncertainty: The blockchain industry faces uncertainty in regulatory policies in different countries and regions, which brings certain risks and challenges to Binance investment. In future development, Binance needs to pay close attention to changes in regulatory policies and formulate corresponding risk management strategies.
2. Security and trust issues: There are security and trust issues in the blockchain field, such as smart contract vulnerabilities, network attacks, etc. Binance needs to strengthen due diligence and security review of investment projects to ensure the security and reliability of user assets.
3. Intensified competition: As competition in the blockchain industry intensifies, Binance faces competitive pressure from other exchanges and investment institutions. In order to maintain its competitive advantage, Binance needs to continuously improve its technical strength and service level, and look for innovative and potential projects to invest in and incubate.
Positioning and opportunities
1. Ecosystem construction and open innovation: Binance can continue to increase its investment and support for the blockchain ecosystem, actively participate in ecosystem construction and open innovation, and promote the widespread application and popularization of blockchain technology.
2. Community governance and co-governance mechanism: Binance can establish a more sound community governance and co-governance mechanism to promote the participation and contribution of community members and achieve co-construction and sharing of the ecosystem.
3. Global layout and strategic cooperation: Binance can further expand its global business layout, establish closer cooperative relationships with projects and institutions around the world, and jointly promote the development of the blockchain industry.
4. Innovative technologies and application scenarios: Binance can continue to focus on the development of innovative technologies and application scenarios such as AI, DePIN, and liquidity staking, actively explore the application of blockchain in DeFi, games, Web3, education and other fields, and promote the deep integration and innovative development of blockchain technology.
In summary, as a leading crypto trading platform, Binance's investment portfolio also leads the investment boom in the crypto industry and occupies a pivotal position in the crypto industry. By continuously optimizing investment strategies, strengthening ecological construction and technological innovation, Binance is expected to further consolidate its leading position in the blockchain ecosystem and promote the development and growth of the entire industry.
Hotcoin is very concerned about the development of Binance's portfolio projects and will continue to monitor and list relevant high-quality assets. For crypto investment, come to Hotcoin to get the hottest high-quality assets first and be one step ahead!
