Alkimiya

Alkimiya operates as a decentralized finance (DeFi) protocol focused on creating capital markets for blockspace, the fundamental commodity of public blockchains. Founded in 2021 by Leo Zhang, a Stanford University mathematics graduate with a background in equity derivatives at Morgan Stanley, and Ricardo Grobel, a former engineer at Itaú Unibanco, the company addresses the financial risks faced by blockchain consensus producers like miners and staking validators. Zhang's experience in traditional finance and Grobel's engineering expertise form the foundation of the company's mission to provide sophisticated hedging solutions in the crypto space.

The core of Alkimiya's business is a permissionless, open-source protocol that allows these producers to manage the inherent volatility and risk of their operations. They face fluctuating revenues due to volatile cryptocurrency prices and network activity, yet lack the financial instruments common in traditional commodity markets like oil or gold. Alkimiya enables these producers to lock in upfront, fixed revenue for their future blockspace production, thereby stabilizing their cash flow and hedging against market downside. This is achieved by creating a market where producers can sell their future hashpower or staking rewards via smart contracts.

Alkimiya's platform serves a dual-sided market. On one side are the consensus producers (miners and stakers) seeking to mitigate risk. On the other are DeFi users, traders, and investors who can purchase these contracts to gain exposure to the underlying economic activity of a blockchain, such as transaction fees, without direct token ownership. This creates a new type of yield-bearing asset backed by the computational work (hashrate) securing the blockchain, rather than just the liquidity of tokens. The protocol abstracts blockspace resources, like average transaction fees, into tradable assets, facilitating more accurate price discovery. For instance, the company has launched markets for trading Bitcoin network transaction fees and revenue generated by the Base Layer-2 rollup. This allows any market participant, from large service providers to individual collectors, to hedge against gas fee volatility or speculate on a network's fundamental growth.

The company has secured significant financial backing from prominent venture capital firms. An initial funding round in June 2021 was led by Dragonfly. This was followed by a $7.2 million round in late 2022, co-led by 1kx and Castle Island Ventures, with participation from Coinbase Ventures, Circle Ventures, and others. This capital has been directed towards team expansion and the launch of a full product suite, including its Vault product and ETH staking contracts on the Ethereum mainnet. Keywords: blockspace markets, decentralized finance, DeFi protocol, crypto hedging, consensus capital markets, hashpower derivatives, staking rewards, transaction fee trading, Leo Zhang, Ricardo Grobel, Anicca Research, risk management, blockchain commodities, yield-bearing assets, crypto financial instruments, Bitcoin fees, Base rollup, Ethereum, Proof-of-Work, Proof-of-Stake