Macauley Peterson

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Polygon Labs and GSR are teaming up on Katana. The new DeFi-optimized blockchain, set to launch next month, has a clear mission: Stop fragmenting liquidity and start redirecting value back to users. 



It’s built on Polygon’s new OP Stack-based cdk-opgeth framework, powered by <a href="https://blockworks.co/news/conduit-gigagas-throughput-sequencer">Conduit’s G2 sequencer</a>, and uses zk finality via Succinct’s SP1 prover. Good tech — but Katana’s true innovation isn’t technical, it’s economic.



This isn’t another “chain for everything” play. Katana is focused on DeFi — a purpose-built appchain designed to concentrate liquidity and maximize real yield. Think of it less as another rollup and more like a high-performance DeFi venue with protocol-aligned incentives, productive TVL and a built-in emissions flywheel, said <a href="https://blockworks.co/tag/polygon">Polygon</a> Labs CEO Marc Boiron.



“When you ask users what they actually want from DeFi, the answer is always the same: deep liquidity and high yields,” Boiron told Blockworks. “General-purpose chains just don’t deliver that.”



Where most <a href="https://blockworks.co/tag/layer-2-2">layer-2s</a> treat DeFi as one vertical among many, Katana makes it the main event. Core protocols like <a href="https://blockworks.co/analytics/morpho">Morpho</a> (lending), <a href="https://blockworks.co/tag/sushi">Sushi</a> (spot DEX), and <a href="https://blockworks.co/podcast/0xresearch/bd00fff0-3b58-11ee-9796-5fbaffa9ad85">Vertex</a> (perp DEX) serve as foundational infrastructure, not one of many apps doing the same thing. In a radical break from the usual DeFi sandbox model, Katana ensures these key partners face no competition within their category on the chain.&nbsp;



That’s by design and is expected to benefit the user experience. “You&#8217;re actually substantially worse off having $100 million split across three protocols than $175 million in one,” Boiron said.



Katana plans to channel activity through these few “core apps,” and supercharge them with yield sourced from five different streams: protocol emissions, KAT incentives, bridged asset yield (via <a href="https://polygon.technology/blog/introducing-vaultbridge-a-new-revenue-lego-for-evm-chains">VaultBridge</a>), sequencer fee redistribution and native stablecoin income (via Agora’s AUSD).



The VaultBridge directs bridged ETH, USDC and WBTC into Morpho vaults on Ethereum. It generates real returns before those assets even reach the chain, then compounds them further once they do. Even the sequencer revenue — which most chains keep for themselves or future validators — is redirected into user incentives and protocol-owned liquidity.



That’s an advantage of the rollup design space, according to Conduit founder Andrew Huang. “We worked with the Katana team to create a custom fee redistribution mechanism for the chain’s sequencer revenues,” Huang told Blockworks.



Thus, with yield transparently flowing from multiple sources and emissions guided by vote-escrowed KAT governance (à la Curve Wars), Katana is aiming for long-term sustainability, not short-term yield farming.



Boiron describes this approach as a response to DeFi’s persistent inefficiencies: fractured liquidity, unsustainable yields and duplicated assets. “If you’re not going to differentiate your blockspace,” he says, “don’t build [it].”



It’s also Polygon’s most serious bet yet on its <a href="https://blockworks.co/podcast/lightspeed/e14b89fa-e5f0-11ee-94eb-d754c5abecb8">AggLayer vision</a> — the idea of a network of tightly integrated chains stitched together via zk bridges and shared liquidity. <a href="https://blockworks.co/news/polygon-and-matter-labs-compete-on-zkevm-rollups">Polygon zkEVM</a>, once slated to fill that role, struggled to gain any user adoption, with activity and REV <a href="https://app.blockworksresearch.com/analytics/polygon-zkevm">on the decline</a> since the spring of 2024. (Blockworks Research is a data partner for Katana.)



Katana aims to showcase what the AggLayer can do as “a chain with very deep liquidity that every other chain can tap into,” Boiron said.



While most OP Stack rollups still rely on fraud proofs and treat tokenomics as an afterthought, Katana integrates zero-knowledge finality from the start. This evolution of the Polygon CDK — now known by the more brand-neutral Agglayer CDK, uses the OP Stack for developer familiarity, but replaces its core infrastructure with Polygon’s AggLayer bridge and execution proofs generated by Succinct’s SP1 prover.



That means no long fraud proof withdrawal windows on canonical bridges, Boiron noted, “and because we’re using OP Stack, users also get all the innovation from Base and Optimism, just ported onto Katana.”



Katana is also aiming for L2Beat’s Stage 1 compliance, meaning users will be able to safely exit without relying on any centralized operators. While Katana’s forced inclusion mechanisms won’t be live on day one, the project is committed to reaching full Stage 1 status shortly after launch. Conduit is working on a product expected later this year that will enable rollups to launch at Stage 1 from the get go, Huang said.



Pre-deposits are now opening in the run-up to launch with a lootbox-style reward mechanic, rather than a more nebulous points system. Public mainnet is scheduled for June 23.



Whether it becomes DeFi’s new liquidity hub or just a clever experiment remains to be seen, but at least it’s not “just another L2.”



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0xResearch Newsletter

Polygon preps a DeFi-focused chain to showcase AggLayer

Ben Strack

The co-CEO and chief technology officer of crypto market maker GSR have exited the firm, the company revealed this week.&nbsp;



Rich Rosenblum, who co-founded the company more than a decade ago, has stepped down “to pursue entrepreneurial opportunities,” GSR said in a Wednesday X <a href="https://x.com/GSR_io/status/1849138871876923579">post</a>.&nbsp;



“His visionary leadership and innovative approach have played a pivotal role in shaping our strategic direction and establishing <a href="https://blockworks.co/tag/gsr">GSR</a> as a leading player in the cryptocurrency market,” the company wrote.



Read more: <a href="https://blockworks.co/news/copper-okx-name-new-executives">Crypto Hiring: Copper, OKX name new executives</a>



John MacDonald, GSR’s CTO since January 2022, will also be leaving the firm.&nbsp;



It is unclear where Rosenblum and MacDonald will work next. A GSR spokesperson did not return a request for comment about who could replace the executives.&nbsp;



The moves come after <a href="https://blockworks.co/news/jump-crypto-president-resigns-gsr-adds-ceos">Rosenblum and Xin Song became co-chief executives</a> on July 1. GSR said at the time that then-CEO Jakob Palmstierna would transition to a president role and lead the company’s client franchise.&nbsp;



As for C-suite additions, crypto trading firm BlockFills appointed Amy Shelly as its chief financial officer and promoted Neil Van Huis to lead the company’s strategy.&nbsp;



Shelly formerly spent about six years — from 2016 to 2022 — as CFO for the Options Clearing Corporation (OCC).



Her new firm “solves fragmented liquidity problems through aggregation and matching algorithms, and provides an end-to-end software suite that simplifies all aspects of the trade lifecycle for institutions,” Shelly said in a LinkedIn <a href="https://www.linkedin.com/posts/amy-shelly-cpa_crypto-cryptocurrency-liquidity-activity-7254897695796994049-4Xme/">post</a>.



Van Huis, a director at BlockFills since 2018, now carries the chief strategy officer title. As a founding partner, Van Huis was tasked with building out global trading relationships and driving new business.



The two executives step into their new positions as the firm “prepares to launch international offices, expands the BlockFills product offering and positions itself for major growth in the institutional digital assets space,” the company said in a statement.&nbsp;



Read more: <a href="https://blockworks.co/news/on-the-margin-newsletter-inevitable-institutional-digital-assets-involvement">Digital assets involvement becoming “inevitable” for more institutions</a>



<a href="https://blockworks.co/tag/coinshares">CoinShares</a>, a crypto asset manager that recently established a New York office, is hiring for roles in sales, marketing, operations and compliance.&nbsp;



These upcoming hires will support the Europe-focused firm’s “commitment to scaling US operations” after the company <a href="https://blockworks.co/news/coinshares-buys-valkyrie-fund-business">acquired Valkyrie’s crypto ETFs</a> earlier this year, the company said this week.&nbsp;



Another crypto-related player, meanwhile, has cut staff, Blockworks has learned.



Nova Labs, the company behind the <a href="https://blockworks.co/tag/helium">Helium</a> Mobile cell network, laid off 36% of its workforce in August, Lightspeed’s Jack Kubinec <a href="https://blockworks.co/news/helium-parent-company-layoffs">reported</a> Friday.&nbsp;



One person familiar with the situation said the layoffs were done to focus more on Nova Labs’ core cellular business. A former employee estimated the company had 105 employees at the time of the cuts.



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CoinShares

Crypto Hiring: Senior execs depart, appointed across segment

GSR named two new co-CEOs as it looks to innovate what it considers to be a turning point for the crypto space.



Rich Rosenblum and Xin Song will each take on chief executive duties starting July 1, the crypto trading firm and liquidity provider said Wednesday.&nbsp;



CEO Jakob Palmstierna will transition to a president role and will lead GSR’s client franchise.&nbsp;



Rosenblum, a former <a href="https://blockworks.co/tag/goldman-sachs">Goldman Sachs</a> pro, co-founded GSR. Song came to GSR in 2019 and built out the company&#8217;s Asia business.



“The industry is at an inflection point and we must remain agile and innovative in how we serve our clients today while also proactively positioning ourselves for the future,” GSR Chair Cristian Gil said in a statement.



In another crypto executive update, <a href="https://blockworks.co/tag/jump-crypto">Jump Crypto</a> President Kanav Kariya said he was leaving the firm.&nbsp;



Read more: <a href="https://blockworks.co/news/sec-terraform-labs-ust-depeg">Jump Crypto president pleads the Fifth when asked about alleged Do Kwon bribe</a>



Kariya, who had served in the crypto company’s president post for nearly three years, noted in a Monday X <a href="https://x.com/KanavKariya/status/1805245324610371761">post</a> that he has not yet committed to a new role.



“As for what’s next, I plan to stay engaged with the portfolio companies I’ve been most involved with and hopefully take some time to process the unbelievably eventful few years we’ve had,” he said.&nbsp;



Richard Chen, a general partner at seed-focused crypto venture fund 1confirmation, is also leaving his company after six-plus years there.



“So what’s next?” he said on X. “I’m starting something new and excited to share the details with you all soon.”



<h2 class="wp-block-heading">Other notable developments</h2>



<ul class="wp-block-list">
<li>Point72 Ventures, the asset manager founded by billionaire Steve Cohen, laid off its fintech and crypto-focused team as part of a shift to AI, Forbes <a href="https://x.com/alexrkonrad/status/1806333497847771389">reported</a>.</li>



<li>Crypto exchange Coinme added Robert Villaseñor as its chief legal and compliance officer. He was most recently general counsel, corporate secretary and chief administrative officer for MoneyGram International.</li>
</ul>



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crypto hiring

Crypto Hiring: Industry trading giant now has 2 CEOs

<div id="highlights-block_62ba247b75669" class="highlights">
 <ul>
 <li>PolySign plans to launch settlement layer PolyNet in the first quarter of 2023</li>
 <li>The funding round follows the company’s raise of $53 million in May 2021</li>
 </ul>
 
</div>



Blockchain infrastructure provider <a href="https://polysign.io/" target="_blank" rel="noreferrer noopener">PolySign</a> has raised an additional $53 million as it seeks to eventually offer instant and automatic settlements for a range of cryptoassets.



Participants in the round included hedge fund Brevan Howard, crypto market maker GSR and Cowen Digital. The latter business, which financial services firm Cowen <a href="https://cms.blockworks.co/financial-firm-cowen-unveils-digital-assets-unit/" target="_blank" rel="noreferrer noopener">launched in March</a>, offers custody solutions via Cowen’s partnership with PolySign subsidiary Standard Custody and Trust Company.



The capital was primarily used for the acquisition of fund administrator MG Stover, which the firm revealed in April. The purchase of the company, which had $40 billion in digital assets under administration at the time, accelerates the company’s product development service enhancements for institutional investors and asset managers, PolySign said in a statement.



PolySign CEO Jack McDonald told Blockworks the Series C round funding would also enable the company to add engineers, accountants and client service teams, as well as accelerate its technology spend.



In the short term, PolySign seeks to continue focusing on its custody offerings through Standard Custody and Trust Company as well as its fund administration business through MG Stover. Its third core product, McDonald said, is PolyNet, a settlement layer that would offer instant and automatic settlement for a range of assets. PolySign expects to launch the latter offering in the first quarter of next year.



PolySign has also secured a $25 million credit facility with Boathouse Capital, it said Tuesday.



Emphasizing the importance of institutional investors in the digital asset space, McDonald said in a statement, “A better platform for custody and fund administration is necessary to serve their unique needs and help expand the market.”



The funding round follows PolySign’s raise of $53 million in May 2021. Cowen led that Series B round with a $25 million strategic investment and was joined by Blockchain.com, Race Capital, Sandia Holdings and PilotRock Investments.



McDonald declined to comment on PolySign’s valuations after each round, but according to private-markets data provider Pitchbook, the latest raise pushed the firm’s valuation over $500 million.



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Brevan Howard

PolySign Nets $53M To Improve Services for Institutions, Asset Managers

Aaron Ahmadi

A recent trend in crypto hiring has confirmed an exodus of top talent from TradFi into the digital assets space that will surely spur mass adoption.



Meltem Demirors, chief strategy officer at digital asset investment firm Coinshares, <a href="https://twitter.com/Melt_Dem/status/1391829838516957189?s=20&amp;t=C1OUUm9AJQD9kWYgMUt16Q" target="_blank" rel="noreferrer noopener">spoke</a> early last year of the likelihood of talent leaving TradFi: “Crypto is going to drain banks of their top talent.”



Demirors appears to have been correct. A <a href="https://www.heidrick.com/en/insights/crypto-digital-assets/from-financial-services-to-blockchain-and-crypto-how-executives-are-making-the-switch" target="_blank" rel="noreferrer noopener">survey</a> carried out by executive search firm Heidrick &amp; Struggles found that almost half of respondents had entered the crypto sector from investment banking.



Crypto companies have more money to spend with <a href="https://fortune.com/2021/11/18/vc-crypto-funds-are-getting-bigger-so-are-the-opportunities/" target="_blank" rel="noreferrer noopener">venture capital funding</a> pouring into the sector. The digital assets arena is also expanding and has much greater depth when it comes to opportunities than heretofore through the development of Web3, decentralized finance, non-fungible tokens (NFTs) and blockchain-based gaming. Meanwhile, compensation at TradFi institutions is up considerably as they are now scrambling to compete for talent.



Coinbase alone <a href="https://coinmarketcap.com/alexandria/article/coinbase-plans-to-hire-2-000-more-employees-this-year?utm_source=ActiveCampaign&amp;utm_medium=email&amp;utm_content=Drake+has+just+won+%241+5+million+in+Bitcoin++here+s+how&amp;utm_campaign=Feb+15+Newsletter_FF&amp;vgo_ee=rghD" target="_blank" rel="noreferrer noopener">plans</a> on hiring 2,000 people in 2022. Data from <a href="https://www.linkedin.com/pulse/all-aboard-bitcoins-rise-inspires-even-big-banks-staff-george-anders/" target="_blank" rel="noreferrer noopener">LinkedIn</a> demonstrated a 615% increase in job postings containing terms such as ‘blockchain’ or ‘crypto’ last August compared to the previous year.



Amid the backdrop of the great resignation, people have changed how they think about life and work, making competition between the TradFi (traditional finance) and digital asset sectors even more acute. It also means that compensation is not the sole factor.



<a href="https://fortune.com/2022/03/07/jobs-in-crypto-hiring-wall-street-exodus/" target="_blank" rel="noreferrer noopener">According</a> to David Duong — who recently left HSBC to head up institutional research at Coinbase — “It’s actually a career risk if I don’t move into this space.” He discounts compensation as the primary motivation and cites an emphasis on the relevance of what he actually works on as the most important factor.



As money and financial systems continue to evolve, we are witnessing a shift from TradFi to the digital assets space. Talented professionals in financial services want to work on relevant and cutting edge projects. As Michael Bucella of crypto investment firm BlockTower Capital <a href="https://www.wsj.com/articles/on-wall-street-bonuses-are-up-but-the-mood-is-not-11642696264" target="_blank" rel="noreferrer noopener">put it recently</a>, crypto “offers [a] level of excitement that the banks can’t.” Bucella exited Goldman Sachs for BlockTower in 2017.



Crypto market maker GSR is a good example of the Cambrian explosion that’s happening in crypto and manifesting itself in the wealth of opportunities that the company is now offering. GSR is <a href="https://jobs.lever.co/gsr" target="_blank" rel="noreferrer noopener">hiring for 100 open roles</a> in London, New York, Singapore and Zug. Earlier this year John MacDonald, former managing director and chief technology officer at Citadel Securities in Europe, joined GSR as its CTO to drive the firm’s technology strategy.&nbsp;



The talent drain is not exclusive to banking. These roles span a myriad of functions including compliance, finance, legal, risk management, sales, software engineering, DevOps and enterprise technology and security.



GSR’s Michael Bressler late last year gave <a href="https://www.efinancialcareers.com/news/2021/12/gsr-crypto-jobs" target="_blank" rel="noreferrer noopener">insight</a> into even greater ambitions for the company, saying, “Our plan is to add 100 hires every six months for the next few years.”



The company’s intentions were certainly borne by its progress in 2021. While GSR started the year with a headcount of 60, the current team is now over 250.



Just like so many others that have made the transition, Bressler is a veteran of traditional finance, having worked for JPMorgan and Goldman Sachs previously. GSR’s global head of sales revealed what the company values most in new crypto hires: “A passion for crypto.”



Hiring is not confined to pure crypto startups either. Many of the companies in TradFi and fintech are also adding staff for newly created crypto units and projects. Having opened a crypto and blockchain business unit in 2021, PayPal has followed up by hiring 100 crypto experts. Payments company Stripe is diving back into crypto following a previous foray into the sector between 2014 and 2018.



Amid what can only be described as a crypto recruiting frenzy, and with crypto and traditional industry leaders announcing blockchain-based products, it’s only a matter of time before the adoption of cryptocurrency becomes a global standard across industries.



<hr class="wp-block-separator"/>



This content is sponsored by <a href="https://www.gsr.io" target="_blank" rel="noreferrer noopener">GSR</a>.

The Crypto Hiring Boom Key for Mass Adoption

Jacquelyn Melinek

<div id="highlights-block_621e76fb8de4a" class="highlights">
 <ul>
 <li>“There is no longer any room for doubt regarding the impact crypto assets are having on our global financial system,&#8221; said Farzam Ehsani, VALR CEO and co-founder</li>
 <li>VALR has processed over $7.5 billion in trading volume since its 2019 launch</li>
 </ul>
 
</div>



South African crypto exchange VALR raised a $50 million venture capital round in one of the largest fundraises for the continent on record.



The exchange raised $50 million — bringing the company’s valuation to $240 million — in a Series B round led by crypto asset manager Pantera Capital, VALR said Tuesday.



The round was oversubscribed with investors including Alameda Research, Cadenza, CMT Digital, Coinbase Ventures, Distributed Global, GSR, Third Prime and Avon Ventures, which is affiliated with Fidelity Investments. Existing investors Bittrex and 4Di Capital also wrote checks.



The funds will be used to expand across Africa and into other emerging markets like India, as well as bringing new products and services onboard and hiring.&nbsp;



In July 2020, VALR raised $3.4 million in a Series A. Its valuation has grown tenfold since.



“There is no longer any room for doubt regarding the impact crypto assets are having on our global financial system,&#8221; Farzam Ehsani, VALR CEO and co-founder, said in a statement.



VALR users can trade and custody more than 60 cryptocurrencies with relatively low fees. Since its 2019 launch, the startup has processed more than $7.5 billion in trades between 250,000 retail customers and 500 institutional clients.



Crypto has grown in Africa as funds have deployed capital to the continent. From July 2020 to June 2021, crypto adoption in Africa increased 1,200%, according to <a href="https://blog.chainalysis.com/reports/africas-grassroots-cryptocurrency-adoption/" target="_blank" rel="noreferrer noopener">Chainalysis</a>. Kenya, Nigeria, South Africa and Tanzania are considered regional crypto hubs.



“In addition to being the third-fastest growing cryptocurrency economy, Africa also has a bigger share of its overall transaction volume made up of retail-sized transfers than any other region at just over 7%, versus the global average of 5.5%,” the report says.&nbsp;



Last year, rapper Jay-Z and Jack Dorsey, current CEO of <a href="https://cms.blockworks.co/jack-dorseys-square-to-change-its-name-to-block/" target="_blank" rel="noreferrer noopener">Block</a>, formerly known as Square, created <a href="https://cms.blockworks.co/?s=africa#:~:text=Jack%20Dorsey%20and%20Jay%2DZ%20Created%20%E2%82%BFtrust%3B%20Here%E2%80%99s%20How%20its%20Board%20Plans%20to%20Deploy%20the%20500%20Bitcoins" target="_blank" rel="noreferrer noopener">₿trust</a>, a new endowment of 500 bitcoins for development across Africa and India. Three of the four ₿trust board members are in Nigeria, with one based in South Africa. 



&#8220;The world is on the precipice of huge financial change,” Ehsani said. “Crypto assets will become more and more pivotal to all our lives.”



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In One of Africa’s Largest Crypto Raises, South African Exchange Takes In $50M

<div id="highlights-block_6217c2b4a546f" class="highlights">
 <ul>
 <li>The capital raised will be used to grow its core products for Ethereum-compatible blockchains like layer-2 networks</li>
 <li>Aligned&#8217;s founder is the former chief strategy officer at ConsenSys</li>
 </ul>
 
</div>



Aligned, a DeFi and Web3 infrastructure company, has secured $34 million in funding, the company announced on Thursday.



Investors include GSR, Altium Capital and Cavalry Fund, as well as individual investors like film producer Happy Walters. This is the firm&#8217;s first funding round, founder Sam Cassatt told Blockworks.



Cassatt, a former chief strategy officer at ConsenSys, said he formed Aligned to provide products for mining, high performance computing and staking and liquidity provisioning through an immutable, full-stack infrastructure for DeFi (decentralized finance).



“[We’re taking] a deep and thoughtful look at what the next generation infrastructure looks like for Web3,” Cassatt noted. “Web3 will have different architectures than Web2, and for us, we’re not just buying commodity hardware or renting it from AWS, we’re building custom hardware.”



In the past 12 months, demand for DeFi has grown astronomically. The total value locked in DeFi protocols has risen 237% from $55.36 billion to $186.55 billion year-over-year, <a href="https://defillama.com/" target="_blank" rel="noreferrer noopener">data</a> from DeFi Llama shows. 



<blockquote class="wp-block-quote is-layout-flow wp-block-quote-is-layout-flow">“Demand will continue to grow,” Cassatt said. “I don’t see this slowing down, it’s getting larger day by day.”&nbsp;</blockquote>



The capital raised will be used to grow its core products for Ethereum-compatible blockchains like layer-2 networks.



“My background is very devoted to Ethereum, and we help get it to market,” Cassatt said to Blockworks. “However, we would be remiss to only focus on the Ethereum network.”



Overall, liquidity needs to be deployed across many new architectures and frameworks, and Cassatt said the company works as much as possible to be agnostic to tokens and networks themselves.



Going forward, the firm plans to continue growing Web3 architecture to create more opportunities for crypto companies building in the space, Cassatt said.



“Our hope is that we can help secure networks and help companies get off the ground faster because we have infrastructure they can use.”



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