After the success of its first fund, the leading web3-focused global venture capital firm is partnering with a major infrastructure player to launch a tokenized second fund with a focus on early and growth-stage layer 1 and layer 2 blockchain networks
NEW YORK, NY –
Led by CEO Anuj Shankar, Luganodes is one of the world’s leading ‘staking services’ providers and is a Swiss-operated, institutional-grade, non-custodial staking provider born out of the Lugano Plan B Program, an initiative driven by Tether and the City of Lugano. Luganodes is the world’s fastest growing staking provider with over $1 billion of staked assets under management across 30+ networks.
“We are delighted to announce Luganodes’ collaboration with Arcanum Capital in the establishment of a transformative VC Fund,” said Shankar. “Arcanum Capital’s unparalleled expertise in supporting innovative blockchain ventures aligns seamlessly with Luganodes’ commitment to building a secure and decentralized internet. This strategic partnership is poised to strengthen our position in the industry and foster advancements in the global blockchain ecosystem.”
James McDowall, founding partner of Arcanum Capital, said, “We have always been passionate about being active investors and helping our portfolio companies as they grow and scale. Having Luganodes as a world-class infrastructure provider participating in testnets, running validator nodes, and operating even more scarce and technically challenging infrastructure components such as decentralized sequencers, whilst providing technical support along the way, will certainly add to our list of key differentiators from other investors in the industry.”
Luchang Zheng, founding partner of Arcanum Capital, said, “The partnership with Luganodes will help Fund II gain access to some of the most sought-after Layer 1 and Layer 2 investment opportunities in the space and enable us to add even more value to our portfolio networks.”
Unlike Fund I, the Arcanum Luganodes Fund II will be tokenized. Lawrence Newhook, a veteran investment professional with an over 30-year track record investing globally across all asset classes, will serve as a director of both Arcanum Emerging Technologies Fund I and Fund II, in addition to his main role as President of DigitalArray ISAC Ltd., a Bermuda-domiciled platform of regulated investment funds that facilitates the launch of institutional funds for best-in-class investment managers. Arcanum will employ the digital securitization solution offered by DigitalArray’s sister company, Laureate Digital Markets, to tokenize Fund II, providing investors the ability to easily sell their fund interests prior to the end of the Fund’s term on a regulated secondary platform or peer-to-peer (subject to any required restrictions on transfer).
“Being able to frictionlessly trade illiquid real-world assets, such as investment funds, is a game-changer for investors,” said Newhook. “Most of the few funds that have tokenized so far have issued tokens that are merely representative of something, like a share of an SPV/feeder. What we are providing for our closed-ended funds is the issuance of securities natively on-chain. Rather than a token that represents economic interests, the actual fund LP interests themselves are on-chain, allowing for instant settlement of funds. All the restrictions on transfer (e.g., regulatory, AML/ATF, investor whitelisting, contractual, etc.) can be built into the smart contract and, when all conditions are satisfied, the transfer happens with no off-chain settlement. For a closed-end fund like Arcanum’s Fund II, an investor can buy today and sell tomorrow, either peer-to-peer or on the secondary market. It gives LPs the potential for liquidity where it otherwise would not have been available to them,” he concluded.
Arcanum Capital was established in 2020 by James McDowall, Luchang Zheng, Karthik Bupathi, and Rahul Andra.
For more information, visit: https://arcanum.capital
About Arcanum Capital
Arcanum Capital is a venture capital firm focused on supporting enterprising and forward-thinking teams that are establishing decentralized networks and applications for the global blockchain ecosystem. Arcanum Capital’s team consists of experienced investment professionals who understand what it takes to evaluate, incubate and scale promising teams and ideas. We have been on the ground as operators, investors, and incubators in frontier and emerging markets, including India, since 2013, and have worked with startups, decentralized networks, and publicly listed companies. During this time, we have cultivated powerful networks and partnerships that are invaluable in helping our portfolio entities transition from idea to market and scale on the global stage.
Luganodes is a AAA rated institutional-grade staking service provider and one of the top leaders in staking volume. Globally, Luganodes’s client base stakes digital assets across 30+ proof-of-stake networks with 99.99% uptime. It is one of the top validators on the Polygon network and the super representative on the Tron network. With Luganodes, enterprises and individuals can take part in validating blockchain transactions and earning staking rewards.
Jon Lindsay Phillips