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Today’s the day!
Berachain’s mainnet is finally launching.
Back in August, we looked at how both Berachain and Monad were able to carve their own paths in a very crowded space, and David even referred to them as potential Solana killers just the other day.
So it’s fair to say the hype train left the station a long time ago.
“Simply put, in a landscape where most blockchain apps and chains today survive or thrive irrespective of one another, Berachain is a philosophical challenge to the current chain-app model. We believe that the network’s novel Proof of Liquidity (PoL) consensus mechanism, which lets network validators direct block rewards to certain apps built on Berachain, could fundamentally reshape how the entire industry views the relationship between builders and blockchains,” Framework’s Michael Anderson explained.
Prior to mainnet launch, Berachain raised a fair amount of capital. In its Series B alone — which was co-led by Framework — it raised $100 million, and that’s not counting the $42 million Series A round.
“The Berachain community is also by far the most fanatical we’ve seen since our involvement in the early days of Chainlink, and we think that the combination of that raw enthusiasm with a real means to influence the direction of the network will be incredibly powerful,” Anderson continued.
Projects that raise as much capital as Berachain are few and far between. But raising more than $140 million before even launching your mainnet is no small sum, so it’s understandable that some might question why crypto projects are looking to raise a ton of money. And why VCs are willing to back such a project.
MV Global’s Tom Dunleavy doesn’t think that projects like Berachain should be raising as much capital. He’d prefer to see raises around $10 million, he wrote in a post on X.
“The valuations associated with big capital intakes set the bar so high that they are priced for perfection for what their user and revenue metrics will be 10 years in the future,” he argued.
But putting a cap on the amount raised isn’t a solution. Mason Nystrom, a junior partner at Pantera, said that there are a variety of reasons for projects to receive funding above $10 million. That includes competition, talent, volatility and opportunity.
Talent is expensive, and Pantera’s own comp survey from last year pegged the average salary at $176,000 for US employees.
Competition and volatility go hand-in-hand. Obviously there’s a lot of competition in the space, especially as an L1. Then you add in the cyclical nature of crypto and, well, the money starts to add up.
Finally, it’s all about opportunity: “The nature of success is power-lawed. The blockchain networks that succeed will be centi-billion to trillion dollar networks. The sheer size of the opportunity presented by blockchain networks (e.g. L1s) enables them to take on more capital to compete to be the power law winners,” Nystrom said.
At this point, crypto funding isn’t out of control and big capital raises aren’t happening every day. If a project manages to close a multi-hundred million dollar round, I say let them cook.
