RockawayX, the Prague-based crypto venture capital firm that backed Solana in 2018 when the blockchain was still a concept, has raised a fresh $125 million for its second early-stage fund despite a slowdown in crypto venture deal-making.
The vehicle, closed in the first quarter and unveiled today, will pour most of its capital into Solana-focused startups. CEO Victor Fischer, a computer science engineer and former McKinsey consultant who bought his first bitcoin in 2015 because a coworking beneath his Prague flat accepted nothing else, began running Solana software from an apartment back when rivals insisted the blockchain needed plush data centers. That tinkering became RockawayX’s calling card: the firm now oversees about $2 billion, operates its own data centers and employs 45 people, two-thirds of them engineers, across Prague, Dubai and London offices.
“Rather than investing in more L1s (core blockchains), we focused on building applications on Solana and being the first user for our founders—from providing liquidity to running solvers and operating hardware services,” says Fischer.
That hands-on ethos worked. RockawayX’s 2021 fund has more than doubled investors’ money and is marked at over five times the invested capital, buoyed by early wagers on Solana (whose market cap has ballooned from $86 million in early 2021 to roughly $78 billion today), market maker Wintermute and lending platform Morpho Labs. That record convinced its investors to re-up just as U.S. crypto VC investment fell 22% in the first quarter, PitchBook data shows.
Roughly two-thirds of the new fund will go to seed investments, the rest will sit in liquid, income-generating positions. Fischer’s thesis is straightforward: as stablecoin adoption soars, users will hunt more opportunities to earn interest and the applications that supply them. “We are positioning ourselves as the core investment firm experts in generating yield on chain,” he says. RockawayX already runs a $100 million on-chain credit pool that has been offering investors about 12% on an annualized basis.
“I think Solana has some work to do in terms of being accepted as a yield-generating platform versus a trading platform,” Fischer adds. The network creates new SOL tokens each year, about 4.6% more currently, to reward the people who help keep it running. Validators, who operate the network, share some of these rewards with users who stake, or lock up, their tokens with them. Because this built-in reward system already offers a yield of about 8%, around 65% of all SOL is simply staked. By comparison, only about 28% of ETH is staked on Ethereum. As a result, less SOL ends up in lending pools or other apps on Solana, explains Fischer.
Still, Solana remains the firm’s bull’s-eye. RockawayX has backed more than 15 projects in the ecosystem and will open “Solana City,” a Dubai accelerator hub, on May 1 with the Solana Foundation and Solana-focused developer firm Helius Labs.
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