One of the most promising aspects of the blockchain is the creation of decentralized financial applications, steering the dependency for transaction facilitations away from intermediaries like traditional banking institutions, exchanges, and brokerages. However, the infrastructure to support this shift away is still being developed to support the eventual replacement of legacy institutions is still being built. This NYC startup is paving the way. Injective, at its core, is a versatile smart contracts infrastructure platform that can be used to power a host a variety of use cases in decentralized finances. The platform offers a growing library of plug-and-play modules that can be used to support applications and functions like the seamless implementation of order books, options trading, and lending capabilities. Injective is built on Cosmos SDK and uses Ignite proof-of-stake consensus mechanism, offering enhanced security and reliability for all transactions without prohibitive high fees or degradation in performance. Since launching, the decentralized applications (dApps) built using the platform have handled in excess of $7B in aggregate volume and 92M transactions, making Injective not only one of the fastest-growing ecosystems but also battle-tested.
AlleyWatch caught up with Injective Labs CEO and Cofounder Eric Chen to learn more about the business, the company’s strategic plans, latest round of funding, which brings the total funding raised to $56.7M, and much, much more…
Who were your investors and how much did you raise?
Injective raised a total of $40M. This funding round was led by Jump Crypto and included BH Digital, the crypto arm of famed hedge fund manager Alan Howard.
Tell us about the product or service that Injective offers.
Injective is a layer 1 blockchain that is optimized for building decentralized finance (DeFi) applications.
Injective provides a cutting-edge smart contracts platform that helps to power decentralized applications. In addition, Injective provides plug-and-play finance modules, such as an order book, binary options, and lending modules that developers can use to build sophisticated dApps.
Not only does Injective provide out-of-the-box solutions, but it also is a blockchain that focuses on providing what finance dApps need, namely a highly secured network through Tendermint, interoperability with prominent layer 1 blockchains, and a shared liquidity pool for all ecosystem dApps.
What inspired the start of Injective?
Injective began as a solution to address the problems we witnessed in the crypto sector firsthand. Most blockchains were built for general-purpose apps which cannot provide the high performance and custom needs of the rapidly growing DeFi sector.
As a result, most developers had to resort to lesser options that ultimately led to a multitude of persistent issues for their dApps (slow transaction times, high fees, and a number of on-chain issues). In addition, most advanced products need to be built by devs from scratch which also leads to a great loss of time since it can take over a year to even launch the initial product.
Injective sought to fix this by creating a blockchain optimized for decentralized finance. Financed focused dApps can be created easily using the plug-and-play modules Injective has provided. No longer do developers need to wait months or years to launch their products (they can do so in a few days if needed). In addition, every parameter of the Injective blockchain is created with finance dApps in mind (fast transaction times, instant finality, automated smart contracts, etc.
How is Injective different?
Injective is the only blockchain built for finance.
Injective is also the only blockchain to have specific products catered toward DeFi developers such as automated smart contracts.
What market does Injective target and how big is it?
Injective focuses on the decentralized finance and derivatives markets which are estimated to be worth quadrillions of US dollars.
What’s your business model?
Injective is a decentralized blockchain. The blockchain itself collects fees from transactions in the native INJ token that powers the network. The fees are then burned. As a result, the value is entirely captured by the token itself.
How are you preparing for a potential recession??
We have always operated in a conservative manner when it came to finances. With the added funding we have secured sufficient runway to continue expanding rapidly regardless of the broader macro conditions.
What was the funding process like?
It was quite seamless. Both of the investment entities approached us initially about structuring a potential investment and we received an offer that we could not refuse.
What are the biggest challenges that you faced while raising capital?
We honestly did not face any challenges during the process. Both investors and us are aligned in our mission of creating the best blockchain for finance. I believe once you have that alignment, the rest of the fundraising process itself becomes largely perfunctory.
What factors about your business led your investors to write the check?
It is due to a combination of factors with the most important being Injective’s technology coupled with its astonishing growth.
Injective has built state-of-the-blockchain infrastructure over the course of the past three years. No one but Injective has the technology needed to support high-performance decentralized finance applications.
In addition, Injective was able to showcase the power of its blockchain via actual adoption. Within the first month of launch, Injective processed over $1 Billion in cumulative volume. Since then, Injective has now processed over $7.2 Billion in volume and over 92 million transactions which outpaces some of the most popular blockchains today.
Injective also released its robust multichain smart contracts platform which also comes with the only automated smart contracts technology in the industry. These factors all contributed to the overwhelming investor interest in Injective.
What are the milestones you plan to achieve in the next six months?
Injective is focused on building the best-in-class ecosystem of finance-focused dApps. You will continue to see a number of new product launches and a rapidly growing ecosystem.
What advice can you offer companies in New York that do not have a fresh injection of capital in the bank?
The best advice is to be as lean as possible. Determine how far you can run without raising since you should assume that raising will likely be quite difficult now. Then of course try to get to product market fit as soon as possible because in a market downturn investors generally like to see more traction before investing.
Where do you see the company going now over the near term?
We see injective being the largest blockchain for finance dApps. Injective will be powering all verticals within the sector such as exchanges, lending, savings, derivatives, etc. Users will interact with a number of dApps that are all supported by the groundbreaking technology that Injective has built.
What’s your favorite restaurant in the city?
Without a doubt, I would have to say that it is Mala Project.