Hotcoin Research: A Detailed Analysis of Binance's Investment Landscape, This Article is Enough

Binance, as a global leading cryptocurrency trading platform, not only provides trading services but also supports and funds potential blockchain projects through its investment incubation programs. These incubation programs have not only brought substantial profit returns to Binance itself but have also played a positive role in the prosperity of the entire blockchain ecosystem.

1. Positioning and Advantages of Binance Investments

Binance's external investments are mainly conducted through its venture capital and incubation department, Binance Labs. Binance Labs was officially established in April 2018. As the venture capital business department within Binance, Binance Labs is positioned to discover founders with innovative ideas, providing support for their project development and co-creating the future of the Web3 industry. The investments of Binance Labs are not limited to specific blockchains and development stages, offering comprehensive support and resources to blockchain entrepreneurs and startups, aiming to help early-stage projects succeed through incubation programs.

Advantages of Binance Labs' External Investments

1. Global Influence: As the venture capital business department within the leading exchange Binance, Binance Labs has a strong reputation and resource support, giving it extensive influence and resources globally.

2. Potential for Integration with the Binance Ecosystem: A key advantage for projects receiving investment from Binance Labs is the potential for integration with the Binance ecosystem and listing on the Binance exchange. Startups can gain significant exposure and access to a large user base, enhancing their chances of success.

3. Value-Added Services: In addition to financial support, Binance Labs also provides general consulting, operational support, and technical/product co-development services. These services help startups address various challenges and enhance their competitiveness and sustainability.

4. Abundant Resources: As part of the world's largest cryptocurrency trading platform, Binance Labs has abundant resources and a vast network. These resources include technology, market access, business partnerships, etc., providing valuable support and assistance to startups.

2. Standards for Selecting Investment Projects at Binance

When selecting investment projects, Binance focuses on aspects such as innovation, sustainability of the business model, market adoption rate, team quality, and technical feasibility. Its strict and comprehensive investment standards and evaluation processes ensure the discovery and cultivation of high-quality projects.

1. Product Innovation: Innovation is one of the primary criteria for evaluating projects. Binance first considers the innovation of the product when selecting investment projects, specifically whether the project has built a new model that benefits users.

2. Sustainable Business and Token Models: Binance emphasizes the sustainability of the project's business and token models. This means assessing whether the project's business model is profitable in the long run and whether the token incentives are structured correctly.

3. Adoption Rate: The traction of a project is one of the important indicators for assessing its value. Factors such as the number of users and generated revenue are crucial for evaluating project traction.

4. Team Quality and Longevity: Binance values the quality and longevity of the project team. If needed, can the team commit full-time to the project? The stability and longevity of the team are critical for the project's development.

5. Technical Feasibility: The final evaluation attribute is technical feasibility, meaning whether the technology used by the project is viable and realistic. Binance assesses the project's technical feasibility based on its technical roadmap and what has been built.

3. Channels and Methods of Binance Investment

In addition to direct investments, the Binance incubation program and the MVB program are the two main investment methods provided by Binance Labs for blockchain startups. Both the incubation program and the MVB program are held twice a year, and since their inception in 2021, six sessions have been successfully conducted, with the seventh session currently underway.

1. Binance Incubation Program

The Binance Incubation Program is a long-term investment method that is not limited to specific chains. It aims to provide comprehensive support and resources for early-stage blockchain startups, promoting the growth of Web3 startups and helping founders achieve significant development and success in a constantly changing industry environment.

Long-Term Support: The Binance Incubation Program offers long-term support to startups, including funding, technology, market, legal, and other forms of support to help them overcome various challenges in the startup phase.

Comprehensive Services: The incubation program provides not only financial support but also various services such as advisory support, marketing, and technical guidance to help startups establish and develop their projects.

Customized Support: The Binance Incubation Program offers customized support and services based on the needs and characteristics of startups, helping them maximize their development potential.

2. MVB Accelerator Program

MVB is the Most Valuable Builder Accelerator Program initiated by Binance Labs, focusing on BNB Chain. Launched in collaboration with BNB Chain, it aims to support outstanding builders and startups that achieve remarkable results within and outside the BNB Chain ecosystem. Winners from the MVB selection will receive donations, technical support, potential investments, and opportunities to list on the main Binance exchange, helping them achieve rapid expansion and growth.

Short-Term Acceleration: The MVB program provides short-term acceleration services for startups, typically lasting 8-10 weeks, aimed at helping them quickly resolve issues, optimize business models, and achieve rapid expansion.

In-Depth Support: The MVB program offers deeper support and guidance for startups, including advice on technology, market, and business models, helping them achieve rapid business development.

Concentrated Resources: The MVB program concentrates the resources and professional teams of Binance Labs to provide comprehensive support and services for startups, helping them achieve greater accomplishments in a short time.

Starting from the seventh session in 2024, the Binance MVB Accelerator Program will expand in two directions: startups and founders, aiming to incubate 100 new ideas on the BNB Chain. The startup track focuses on promoting the rapid development of early cryptocurrency projects, while the founder track emphasizes supporting and incubating builders to help them grow into successful founders.

4. Data Performance of Binance Investments

Since its establishment in 2018, Binance Labs' investment portfolio includes over 200 projects from more than 25 countries across six continents, with more than 50 incubated by Binance Labs. According to The Block, as of the first quarter of 2024, Binance Labs has accumulated $9 billion in assets. According to a Binance spokesperson, its theoretical return is over ten times the investment amount.

Number of Investment Projects

As of May 15, 2024, Binance has publicly announced 19 investment projects this year, with a total amount of approximately $364 million. These include Zest Protocol, UXUY, Movement, MilkyWay, BounceBit, StakeStone, Cellula, Derivio, QnA3, Privasea, Babylon, Renzo Protocol, Ethena, NFPrompt, Shogun, Analog, Puffer Finance, Memeland, BracketX, and others.

RootData has recorded a total of 193 external investment projects by Binance Labs, of which 108 have issued tokens and are operational. A total of 65 projects were shortlisted in the first to sixth sessions of the incubation program, and 36 projects were shortlisted in the first to sixth sessions of the MVB accelerator.

Image source: RootData

Investment Layout and Scale of Binance

In terms of investment layout, Binance Labs covers a wide range of investment areas, encompassing most tracks related to Web3, including public chains, protocols, infrastructure, NFTs, blockchain games, metaverse, DeFi, and CeFi. Binance Labs places particular emphasis on infrastructure, on-chain applications, data analysis, and security. These areas are not only core to the development of the cryptocurrency industry but are also prioritized investment directions for Binance Labs.

Image source: RootData

• Infrastructure: Accounts for the largest proportion of Binance Labs' investment portfolio, reaching 38.3%, serving as the cornerstone of the blockchain and cryptocurrency industry.

• DeFi: Accounts for 20.7% of the investment proportion, not only has significant market potential but is also at the forefront of industry innovation.

• Gaming: Accounts for 16.5% of the investment proportion, leading industry innovation.

• Web3-related tracks: Approximately 24.5%, including social entertainment, tools & information services, NFTs, etc., are considered the next growth points in the cryptocurrency industry.

In terms of investment scale, Binance Labs primarily focuses on investments in the range of $1 million to $10 million, with the most concentrated investment amount range being $1 million to $3 million, followed by $5 million to $10 million. Binance Labs primarily participates in investments as a non-leading investor, with leading investments being supplementary.

Investment Return Performance of Binance

In terms of investment returns, Binance Labs' investments in Web3 have supported well-known companies such as Polygon, Optimism, LayerZero, Celestia, Aptos, Mysten Labs, and Trust Wallet. According to data from the Chain Broker platform, there are six Binance investment projects with a return on investment (ROI) exceeding 100 times, namely Polygon, Injective, Axie, Sandbox, MultiversX, and Merit Circle.

Image source: Chain Broker

5. Review of Hot Investment Projects by Binance

In previous MVB accelerator programs, Binance Labs invested in high-quality projects such as the decentralized domain protocol Space ID, Web3 infrastructure Overeality, interoperability communication protocol Multichain Event Protocol (MEP), mobile strategy game Meta Apes, tokenized investment portfolio Velvet Capital, multi-chain open data analysis platform Web3Go, casual gaming platform Gameta, Ethereum scaling project AltLayer, perpetual DEX project KiloEx, lending protocol Kinza Finance, and AI blockchain-based virtual companion game Sleepless AI.

On March 1, Binance Labs announced 13 early projects for the seventh season of the MVB accelerator program, covering three major tracks: DeFi, infrastructure, and application layers. These projects demonstrate innovation and potential in the blockchain and AI fields and are worth attention.

1. BitU: BitU is a crypto-native collateralized stablecoin protocol that provides higher yields using off-chain liquidity and efficiency. Its Active Liquidity Management Module (ALMM) addresses the interest rate differential between on-chain and off-chain stablecoin lending and introduces trusted custodians to provide users with safer fund storage and yield distribution.

2. Blum: Blum is a hybrid CeDeFi exchange that allows users to trade cryptocurrencies via a Telegram mini-program. It offers off-chain order books, on-chain settlement, and centralized or self-custody options, while also supporting derivatives trading services.

3. Surf Protocol: Surf Protocol is a perpetual contract trading platform based on Base, providing leveraged trading, pre-market trading, and point trading services for low market cap tokens.

4. Vooi: Vooi is a cross-chain perpetual contract DEX aggregator that supports multiple DEXs, allowing users to trade without gas fees after connecting their wallets, with leverage up to 100 times.

5. Aggregata: Aggregata is a DePIN-driven AI data storage project that can create high-quality data and price it, allowing users to share, sell, and find AI datasets on its marketplace.

6. Nesa: Nesa is a lightweight Layer 1 for AI that uses on-chain ZKML for highly private, secure, and trusted query execution for AI inference. It proposes a privacy-centric decentralized inference protocol that commits computation inference results through a secure committee and sends them on-chain.

7. Nimble Network: Nimble Network is a composable AI protocol that allows AI agents, data providers, and computing resources to combine and use ML models and data. It is creating atomic components for the protocol to expand into IP, creators, advertising, personalization, and chatbots.

8. Aspecta: Aspecta is an AI-driven digital identity ecosystem platform that has built an AI-generated identity system, Aspecta ID, for developers and others to demonstrate, connect, and explore. It also provides access to exclusive DAOs, ecosystems, and applications.

9. Holoworld: Holoworld is a decentralized AI virtual character marketplace and social platform where anyone can create intelligent AI robots with just a few clicks.

10. Opinion Labs: Opinion Labs is a dynamic opinion and continuous prediction market that has created a full-chain social infrastructure, with its first product being a full-chain opinion market and content community DApp, AlphaOrBeta.

11. Side Quest: Side Quest is a gaming social platform aimed at providing various gaming, earning, dining, and communication opportunities.

12. Story Chain: Story Chain is an AI story-writing NFT application that allows users to create stories with unique chapters and art using LLM and image AI, minting them as NFTs.

13. Tilted: Tilted is a gaming asset marketplace for buying, selling, and trading gaming assets, skins, and NFTs on-chain, achieving cross-game compatibility.

6. Challenges and Opportunities in Binance Investments

With the support of Binance Labs, many blockchain startups have achieved remarkable accomplishments. These projects cover areas such as DeFi, NFTs, and blockchain infrastructure, providing strong validation for the effectiveness of Binance's investment strategies and incubation methods. With the rise of narratives such as AI, DePIN, and LSD, as well as the emergence of ecosystems like Bitcoin and Solana, Binance investments face a series of opportunities and challenges.

Challenges and Issues

1. Regulatory Uncertainty: The blockchain industry faces regulatory uncertainties in different countries and regions, posing certain risks and challenges for Binance investments. In future developments, Binance needs to closely monitor changes in regulatory policies and formulate corresponding risk management strategies.

2. Security and Trust Issues: The blockchain field faces security and trust challenges, such as smart contract vulnerabilities and network attacks. Binance needs to strengthen due diligence and security reviews of investment projects to ensure the safety and reliability of user assets.

3. Intensified Competition: As competition in the blockchain industry intensifies, Binance faces competitive pressure from other exchanges and investment institutions. To maintain a competitive edge, Binance needs to continuously enhance its technical capabilities and service levels, seeking innovative and potential projects for investment and incubation.

Positioning and Opportunities

1. Ecosystem Building and Open Innovation: Binance can continue to increase its investment and support for the blockchain ecosystem, actively participating in ecosystem building and open innovation to promote the widespread application and popularization of blockchain technology.

2. Community Governance and Co-Governance Mechanisms: Binance can establish a more robust community governance and co-governance mechanism to promote the participation and contributions of community members, achieving co-construction and sharing of the ecosystem.

3. Global Layout and Strategic Cooperation: Binance can further expand its global business layout, establishing closer cooperative relationships with projects and institutions worldwide to jointly promote the development of the blockchain industry.

4. Innovative Technologies and Application Scenarios: Binance can continue to focus on the development of innovative technologies and application scenarios such as AI, DePIN, and liquid staking, actively exploring the application of blockchain in DeFi, gaming, Web3, education, and other fields, promoting the deep integration and innovative development of blockchain technology.

In summary, as a leading cryptocurrency trading platform, Binance's investment portfolio also leads the investment boom in the crypto industry, occupying a pivotal position in the cryptocurrency sector. By continuously optimizing investment strategies, strengthening ecosystem building, and fostering technological innovation, Binance is expected to further consolidate its leading position in the blockchain ecosystem and promote the growth and development of the entire industry.

Hotcoin is very attentive to the development dynamics of Binance's portfolio projects and will continue to monitor and launch related high-quality assets. For cryptocurrency investments, come to Hotcoin, where the hottest quality assets are accessible first and faster!