Fintech

Investing is not enough: Andreessen Horowitz has a new crypto research lab

The firm is trying to bridge academia and the crypto industry, an unusual investment in VC.

Tim Roughgarden, left, and Dan Boneh, right.

Tim Roughgarden is head of research and Dan Boneh is senior research adviser at a16z Crypto Research, a new research lab focusing on bringing academic research into crypto and Web3.

Photos: a16z

Andreessen Horowitz is starting a new research unit designed to bring academics into tackling some of the hardest problems in Web3 and crypto.

It’s called A16z Crypto Research and it’s modeled after research labs such as OpenAI and Alphabet’s DeepMind. Tim Roughgarden, a professor at Columbia and Stanford who has written extensively on Web3, is its head of research.

“Usually whenever there's a new groundbreaking technology that has general purpose and can be used for all sorts of different things, there's an opportunity for an industrial research lab to bridge the world of academia with the world of industry practice,” said Ali Yahya, a general partner at Andreessen Horowitz who previously worked at Google on Google Brain.

Dan Boneh, a professor at Stanford, is being promoted to senior research adviser and four others are joining as research partners: Joseph Bonneau, who’s written extensively on cryptocurrency; Benedikt Bünz, a Stanford Ph.D. student and chief scientist at Espresso Systems; Scott Kominers, a Harvard Business School professor; and Valeria Nikolaenko, a former research scientist for Novi at Meta.

While many crypto firms have hired research teams, A16z is attempting something bigger: an entire research lab to take on crypto.

The research unit aims to create a pipeline from research to industry, working with a16z’s engineering, regulatory and marketing teams.

As part of the venture firm, a16z Crypto Research will work with the firm’s portfolio companies and investors to help determine what topics to take on. The group will seek to address broad industry challenges, Yahya said.

It will aim to produce work that is open source and that the entire industry can benefit from. This approach is better than a university-based lab, because it is closely aligned with people working in the industry, Yahya said. “All we only, really want from all of the work that comes out of the research lab is for it to be open source,” he said.

Like other research labs such as Bell Labs, SRI and others, the research is designed to bring academic and scientific research into eventual commercial use. While that could happen through deployment by a16z portfolio companies, projects could also be spun out into independent companies, Yahya said.

The researchers could join a portfolio company to work on the ideas or they could potentially start companies using the ideas. “And in those cases, then we might fund them, which would be a success case,” Yahya said.

And as part of the venture firm, everyone involved in the lab will have upside in the work in a way that’s not possible in a traditional academic research lab, he said.

Topics of study could range from technologies to achieve consensus on blockchains or Layer 2 scaling solutions to application layer issues, automated market makers or NFT design, Roughgarden said.

The research will likely initially flow from team members’ interests. Kominers, who is an expert on applications, could work on issues such as the design of NFT marketplaces. The other three focus more on cryptography and security: Bonneau, who wrote a book on crypto; Bünz, who worked on zero-knowledge proofs and verifiable delay functions; and Nikolaenko, an expert on proof of stake. The team will grow by “many multiples,” Roughgarden said.

Computer science often ranges from very specific to general theories, but this new unit will be able to address real-world problems, he added.

“These are the problems that our portfolio companies are struggling with that you see over and over again across different projects,” he said. “That's kind of a telltale sign that this could be your next great academic research paper capturing the essence of where everybody is stuck.”

Fintech

What the fate of 9 small tokens means for the crypto industry

The SEC says nine tokens in the Coinbase insider trading case are securities, but they are similar to many other tokens that are already trading on exchanges.

While a number of pieces of crypto legislation have been introduced in Congress, the SEC’s moves in court could become precedent until any legislation is passed or broader executive actions are made.

Illustration: Christopher T. Fong/Protocol

When the SEC accused a former Coinbase employee of insider trading last month, it specifically named nine cryptocurrencies as securities, potentially opening the door to regulation for the rest of the industry.

If a judge agrees with the SEC’s argument, many other similar tokens could be deemed securities — and the companies that trade them could be forced to be regulated as securities exchanges. When Ripple was sued by the SEC last year, for example, Coinbase chose to suspend trading the token rather than risk drawing scrutiny from federal regulators. In this case, however, Coinbase says the nine tokens – seven of which trade on Coinbase — aren’t securities.

Keep Reading Show less
Tomio Geron

Tomio Geron ( @tomiogeron) is a San Francisco-based reporter covering fintech. He was previously a reporter and editor at The Wall Street Journal, covering venture capital and startups. Before that, he worked as a staff writer at Forbes, covering social media and venture capital, and also edited the Midas List of top tech investors. He has also worked at newspapers covering crime, courts, health and other topics. He can be reached at tgeron@protocol.com or tgeron@protonmail.com.

Sponsored Content

They created Digital People. Now, they’ve made celebrities available as Digital Twins

Protocol talks to Soul Machines’ CEO about the power of AI in the metaverse


Keep Reading Show less
David Silverberg
David Silverberg is a Toronto-based freelance journalist, editor and writing coach. He writes for The Washington Post, BBC News, Business Insider, The Toronto Star, New Scientist, Fodor's, and several alumni magazines. He also writes for brands such as 23andme, Shopify and Bold Commerce. He has served as editor of B2B News Network, Canada's only B2B news magazine, and Digital Journal, a leading pioneer in citizen journalism. Find more about him at www.davidsilverberg.ca
Enterprise

Werner Vogels: Enterprises are more daring than you might think

The longtime chief technology officer talked with Protocol about the AWS customers that first flocked to serverless, how AI and ML are making life easier for developers and his “primitives, not frameworks” stance.

"We knew that if cloud would really be effective, development would change radically."

Photo: Amazon

When AWS unveiled Lambda in 2014, Werner Vogels thought the serverless compute service would be the domain of young, more tech-savvy businesses.

But it was enterprises that flocked to serverless first, Amazon’s longtime chief technology officer told Protocol in an interview last week.

Keep Reading Show less
Donna Goodison

Donna Goodison (@dgoodison) is Protocol's senior reporter focusing on enterprise infrastructure technology, from the 'Big 3' cloud computing providers to data centers. She previously covered the public cloud at CRN after 15 years as a business reporter for the Boston Herald. Based in Massachusetts, she also has worked as a Boston Globe freelancer, business reporter at the Boston Business Journal and real estate reporter at Banker & Tradesman after toiling at weekly newspapers.

Climate

Dark money is trying to kill the Inflation Reduction Act from the left

A new campaign is using social media to target voters in progressive districts to ask their representatives to vote against the Inflation Reduction Act. But it appears to be linked to GOP operatives.

United for Clean Power's campaign is a symptom of how quickly and easily social media allows interest groups to reach a targeted audience.

Photo: Anna Moneymaker/Getty Images

The social media feeds of progressive voters have been bombarded by a series of ads this past week telling them to urge their Democratic representatives to vote against the Inflation Reduction Act.

The ads aren’t from the Sunrise Movement or other progressive climate stalwarts, though. Instead, they’re being pushed by United for Clean Power, a murky dark money operation that appears to have connections with Republican operatives.

Keep Reading Show less
Lisa Martine Jenkins

Lisa Martine Jenkins is a senior reporter at Protocol covering climate. Lisa previously wrote for Morning Consult, Chemical Watch and the Associated Press. Lisa is currently based in Brooklyn, and is originally from the Bay Area. Find her on Twitter ( @l_m_j_) or reach out via email (ljenkins@protocol.com).

Entertainment

A game that lets you battle Arya Stark and LeBron James? OK!

Don’t know what to do this weekend? We’ve got you covered.

Image: Toho; Warner Bros. Games; Bloomberg

This week we’re jumping into an overnight, free-to-play brawler; one of the best Japanese dubs we’ve heard in a while; and a look inside a fringe subculture of anarchists.

Keep Reading Show less
Nick Statt

Nick Statt is Protocol's video game reporter. Prior to joining Protocol, he was news editor at The Verge covering the gaming industry, mobile apps and antitrust out of San Francisco, in addition to managing coverage of Silicon Valley tech giants and startups. He now resides in Rochester, New York, home of the garbage plate and, completely coincidentally, the World Video Game Hall of Fame. He can be reached at nstatt@protocol.com.

Latest Stories
Bulletins