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Note: On September 25, 2024, Union Square Ventures announced that it would lead the seed round of financing of Daylight, a personalized on-chain behavior information flow platform, with 1kx jointly led the investment, and the co-founders of Framework Ventures, Chapter One, and Zerion, Blockaid and YupPeople and others participated in the investment.Nikhil Raman and Nick Grossman from USVs posted a post to explain why they led the investment in Daylight; 0xjs@Bitchain Vision.
The following is the USV article:
Many of its commitments have been largely fulfilled over the past 15 years as cryptocurrencies develop and mature.Every day, millions of users around the world bring their wallets to various applications, where they perform on-chain operations and have sovereignty over their assets and data.
Many of these operations are the result of a user’s direct interaction with an application, protocol, or asset.But the open, composable and license-free nature of cryptocurrencies means that all of these operations can be easily packaged and presented in the form of an embedded experience, while retaining its full functionality.
These conditions create opportunities for products like Daylight.At the heart of Daylight is a personalized transaction recommendation information flow that can be integrated into various applications and wallets to present to users through APIs.These recommendations come in the form of minting, claiming, tasks, etc. – as cryptocurrency applications become more diverse, new types of transactions continue to emerge.Just provide the wallet address, Daylight can ingest users’ on-chain activity and use it to help users find useful and personalized things on-chain.
Daylight currently offers recommendations for the Home and Discovery pages of many of the most popular wallets, covering more than 6 million active addresses per month.However, a wallet is just an application type that knows the user’s address, and in fact any “address-aware” Internet application (meaning that it has a user with a known blockchain wallet address) can use this information flow.
Daylight’s discovery engine helps applications provide users with a better experience, while also providing an income opportunity, as on-chain transactions are often very valuable operations, and Daylight can help application partners enter this process.Furthermore, due to the open and composable nature of cryptocurrencies, value streams can be stacked and embedded without permission, opening up an unlimited canvas for connecting value across applications and experiences.
For example, every time a casting is done on Zora, the agreement pays the creator and referral websites.These rules are transparent and embedded in the protocol, and rewards are automatically paid for each minting.To some extent, channels like Daylight bring volume to protocols like Zora, they get a share of these rewards and can be further shared with their distribution partners, all without the need to pre-built businessrelation.Recommended streams like this are common in Web2, but they require trust and contractual agreements and are slow to pay.On the other hand, the openness of cryptocurrencies allows anyone to enter this process and create a more inclusive and efficient value chain.
As cryptocurrencies develop, more and more people will pay attention to address-aware applications and spend more time in them.This will provide opportunities to recommend more operations to users and to gain more detailed understanding of users.The results may be similar to the architecture of the Web2 advertising/recommendation ecosystem, but it may also be very different given the open, composable and address-aware nature of Web3.We are looking forward to discovering it.
The dynamic and openness of growing and discovering issues in Web3 are part of what impressed us with the Daylight team.Co-founders Kyle and Morley have had experiences in Web2 and Web3 organizations, have a deep understanding of wallets, and treat the field with great pragmatism.We are so excited to work with them and lead a $6 million seed round of Daylight with our friends at 1kx.
