Fabric Ventures: Why We Invested in Argent

Fabric Ventures recently announced that it has led a $40 million Series B round in Argent with Metaplanet, with participation from strategic investors such as Starkware, Jump and Animoca, as well as existing investors Paradigm, Index Ventures and Creandum. Fabric Ventures explained in a Medium post on May 4 why it invested in Argent.

Mass adoption of Web3 requires simple, secure, and inexpensive user access; while millions of people already have some experience with encryption, the user process remains cumbersome and risky. Existing users of high-information encryption are comfortable with this paradigm, willing to navigate the current complexities on their own while taking the risk of losing money.

But the newer, more casual users necessary for the ecosystem to grow to mass adoption are not comfortable with these risks. These users need their web3 portal (their wallet) to seamlessly and easily integrate with the ecosystem, eliminating the risk of irreversible loss of funds.

Also, until recently, most of the activity took place on the first layer of Ethereum, inaccessible to all but the wealthiest users.

To cater to the mass market, any wallet must address both of these issues. Argent is exactly such a wallet. They provide a non-custodial smart contract wallet on top of Ethereum layer 2 scaling solutions (Starknet and zksync) and Ethereum layer 1. This allows users to take advantage of low fees, add security features (such as social recovery and fraud monitoring) and provide abstracted accounts for seamless integration with dapps.

Building on layer 2 Ethereum scaling solutions such as Starknet and zksync can significantly reduce fees for users, high fees are currently a significant barrier to entry into the crypto market. With the Argent X browser wallet, Argent is positioned as the first wallet on starknet, and its ecosystem has exploded before launch. In just a few months, Argent X has surpassed 100,000 downloads and its weekly transaction volume has jumped from a few thousand to nearly half a million. We believe these numbers will only grow with the launch of starknet. Argent’s mobile app on zksync has had over 500,000 registered users over the past few months, and we’re excited that zksync V2 will be available later in 2022, allowing Argent to take advantage of the innate advantages of smart wallet and account abstraction.

As a non-custodial smart contract wallet, Argent has been able to implement valuable security features necessary for the adoption of web3 by ordinary users. Users do not rely on centralized actors and control their own assets, but do not weigh this benefit with undue complexity and risk. Argent provides social recovery and fraud monitoring, so users don’t need to memorize mnemonics (12 random words) or constantly monitor malicious actors, and prevent “fat finger” mistakes. The importance of fraud management is well known and seen firsthand by Anil (Fabric Ventures general partner), and it was the catalyst for PayPal’s success in the mass market.

It was features like social recovery that drew us to the Argent mobile wallet a few years ago, first and foremost as users — for many at Fabric, it was our first mobile wallet for DeFi. Since then, we’ve loved the development of the app and are excited about the team’s vision to scale into a super-app across all web3: enabling functionality with cheaper scaling solution fees.

While in the long run we think the nature of Argent as a smart contract wallet positions it as a wallet that anyone can log into web3, we also think it’s important to see the wallet as the ecosystem’s default/de facto wallet in order to get Attractiveness to high-informed users currently in the crypto space. This is an argument we’ve seen with things like metamask on EVM and phantom on Solana. Therefore, we are particularly excited about Argent’s place in the starknet ecosystem.

Argent has an executive team with a clear vision, focus and execution, including Itamar, Gerard and Julien, to provide access to the next generation of web3 users. The team is a long-term collaborator, having worked with a number of companies over the past two decades, which Anil has had the privilege of seeing firsthand through previous work collaborations (who supported Itamar at Peak), which were successfully sold to Hachette. Instead of chasing what’s current, they focus on building for the future, developing consumer-essential features like social recovery, and their place in ecosystems like starknet and ZKsync.

While we have historically invested in early stage venture funds (pre-seed, seed, Series A), Fabric is pleased to back this investment at a later stage – our fifth deal in venture growth. Our portfolio has grown and matured with us since we started investing in 2016, and we’re proud to back them with a larger vote at a later stage. In addition to these investments, we are excited to invest in companies that we have long followed and believed strongly in, such as Argent and Immutable.

We are excited to partner with Argent as they expand their offerings across geographies and protocols: from games and NFTs to DeFi and DAOs, they will bring web3 to the masses.

We support the most daring technologists and communities at the earliest stages, supporting them throughout their journey and being an active participant in the networks they are building.

Posted by:CoinYuppie,Reprinted with attribution to:https://coinyuppie.com/fabric-ventures-why-we-invested-in-argent/
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