OKX Unveils Exclusive Polygon-Powered Layer-2 Blockchain
OKX has recently rolled out its proprietary Layer-2 blockchain, the X1 chain, powered by Polygon’s cutting-edge technology, in a strategic move to elevate the efficiency of digital transactions. This initiative positions OKX among a cadre of exchanges actively exploring secondary networks to streamline and cost-optimize digital asset transactions.
📣 Hot Off The Press 📣
We’re thrilled to introduce #X1, our new Ethereum L2 network built on Polygon’s CDK.
Our landmark collab. with @0xPolygonLabs empowers next gen. devs. with increased security, scalability & low transaction costs to BUIDL the future of Web3.
🧵👇 pic.twitter.com/Wkz11vu2be
— OKX (@okx) November 14, 2023
Taking a cue from industry giants like Coinbase, which unveiled its Base blockchain to widespread acclaim in August, OKX’s move highlights the evolving landscape of exchanges venturing into the development of Layer-2 blockchains. Kraken, another prominent player in the crypto exchange sphere, is reportedly mulling over the creation of its own Layer-2 blockchain, according to Bloomberg.
The advent of Layer-2 solutions, championed by entities such as Polygon, Optimism, and Arbitrum, primarily aims to enhance the capabilities of Ethereum. OKX’s X1 chain is slated to become available to end-users in early 2024, with a dedicated team of fifty developers from OKX actively engaged in its development.
This trend signifies a broader transformation in the cryptocurrency ecosystem, where exchanges transcend their traditional roles as transaction facilitators to become trailblazers in blockchain technology. They are now focused on optimizing transactional efficiency and expanding the potential applications of blockchain. However, the profitability of L2 chain development for exchanges remains an open question that only time will answer.
Blockchain.com Secures $110M in Series E Funding
Blockchain.com has successfully raised $110 million in Series E funding, with UK-based investment management firm Kingsway Capital leading the financing round. Other notable participants include Baillie Gifford, Lakestar, Lightspeed Venture Partners, Coinbase Ventures, and several others.
As of the latest funding, Blockchain.com’s valuation is reported to be “less than half of” its peak valuation of $14 billion, which was attained in March 2022 following a Series D financing round. Kingsway Capital founder and CEO Manny Stotz, along with Nicolas Brand, a partner at Lakestar, have joined the board of investors at Blockchain.com in the wake of this recent funding round.
It’s worth noting that Kingsway Capital had previously spearheaded an undisclosed funding round for Blockchain.com in the third quarter of the preceding year, as reported by The Block in October 2022.
However, Blockchain.com faced significant challenges, grappling with a $270 million shortfall resulting from the 2021 collapse of crypto lender Three Arrows Capital, to which the company had extended funds.
This setback prompted Blockchain.com to take drastic measures, including laying off 25% of its workforce (150 employees), shutting down its Argentinian office, and reducing CEO compensation in July 2022. The recent Series E funding may offer the company a strategic lifeline as it navigates these challenges.
