If there's one thing everyone in crypto is waiting for, it's institutional investors: retirement plans, university endowments, pensions and giant hedge funds. Of course, they are investing, but they are tepid, and their bets are relatively small.

• Driving the news: Elwood Technologies, a crypto software maker founded by British billionaire Alan Howard, raised $70 million in its first outside round of funding, with Goldman Sachs and Dawn Capital leading, writes Lucinda Shen of Axios Pro.

Why it matters: It's rare to see a bank leading a round in a crypto company. Goldman Sachs' co-lead position underlines how it's become one of the most active bulge bracket banks in the digital asset space.

Background: Earlier this year, Goldman revealed its first bitcoin-backed loan. It also made its first over-the-counter crypto trade in March. Last year, it began offering bitcoin derivatives to investors and led a round in Coin Metrics, a crypto analytics business.

Details: Crypto proponents have long hoped for wider institutional adoption, believing the sector will surge once the giants enter.

• "There's still a big retail mindset when it comes to digital assets and crypto," Elwood CEO James Stickland said. "Having algorithms, for example, are not standard ... we've taken it upon ourselves to fill some of that hole."
• Elwood allows traders to access multiple crypto exchanges through one platform and offers order management and portfolio management capabilities.

Notably, the funding is not coming from Goldman Sachs' growth equity arm but directly from its digital assets team.

• The bank will also be taking a board observer seat in the business.
• Other investors in the round included Barclays, BlockFi Ventures, Chimera Ventures, CommerzVentures, Digital Currency Group, Flow Traders and Galaxy Digital Ventures.

Brady's thought bubble: It's hard to say how much institutional money is in because they don't tend to like to advertise it, but as far back as 2018, the Yale Endowment, for one example, was said to have made a big bet on the crypto fund Paradigm.

• In the slew of new billion-dollar funds that have launched this year, the word on the street has been that there are many larger institutional partners.

By the numbers: The deal values the company north of $500 million, a source with knowledge of the matters confirmed to Axios.

• Though Stickland declined to reveal revenue figures, he says the company is handling billions of dollars in flow and has over 30 customers.

Yes, but: The funding announcement comes amid a crypto selloff, with bitcoin having shed its gains for the year. That, inevitably, raises questions about whether banks are here to stay this time around.

The price of Ethereum's native coin, ETH, and a derivative of it, stETH, are starting to diverge just a little bit, which may be telling, Brady writes.

Zooming out: There's currently 4 million Ethers ($8 billion dollars worth) locked up on the protocol Lido and it cannot be moved until Ethereum transitions to proof-of-stake, its next consensus mechanism (the new version should go live this year, as Decrypt explains in detail).

• In proof-of-stake, entities validating transactions on the blockchain put an asset (in this case, ETH) at risk as insurance against malicious activity. Though Ethereum hasn't made the transition yet, billions of dollars are already committed.
• By locking up ETH, depositors earn more ETH, but none of it is useable until the blockchain successfully transitions.

People who voluntarily staked their ETH using the protocol Lido got stETH for doing so. Not only that, but they get the new emissions too.

State of play: The new token can't be used to pay for processing on the network, but it does earn a return, while ETH doesn't.

• Somehow, it has typically traded at parity with ETH, but over the last week they've diverged just a little. The market might finally be realizing they aren't quite the same thing.

Venture capital giant Andreessen Horowitz argues that what seems like a boom-and-bust cycle in crypto has an underlying logic, Brady writes.

Driving the news: In a blog post accompanying the first of what it promises will be an ongoing series of annual reports on cryptocurrency, several members of the firm write:

"Whereas prices are often a lagging indicator of performance in some industries, in crypto they are a leading indicator. Prices are a hook. The numbers drive interest, which drives ideas and activity, which in turn drives innovation."

Yes, but: The post and the report are unabashedly booster-y. It should be read as a report written by a company that's massively invested in the sector's success.

Nevertheless, it provides some points of illumination:

• Web3 could be great for creatives. It points out that creators on OpenSea, the leading marketplace for NFTs, have generated an estimated $3.9 billion in sales.
• Brady's 💭: That said, it might be worth asking how much of that went to lone artists or small teams versus well-resourced startups that farmed out much of the creative work.
• Ethereum is leading in smart contracts, but other chains are chasing it. It notes that Ethereum's commitment to remaining decentralized has held it back in terms of efficiency.
• It's still early. "We estimate there are somewhere between 7 million and 50 million active Ethereum users today, based on various on-chain metrics," the blog post states. So, it's somewhere between the population of Paraguay and Spain, roughly.

The bottom line: The authors remain bullish on their bets. "Consider that any prospective founders who swore off tech and the internet in the aftermath of the early-2000s dot-com crash missed the best opportunities of the decade," they write. "Now is the time to consider what the equivalent successes will be in web3."

• See more details in the full report.

🛑 The Terra community does not want to fork the blockchain. (The Block)

🎧 Spotify is testing an NFT promotion feature for select musicians. (The Verge)

👾 Twitch's co-founder raised $24M for the company behind the sci-fi metaverse game universe DuskBreakers. (Decrypt)

🇬🇧 The U.K. moved forward with a plan to formalize fiat-backed stablecoins as a means of payment. (The Defiant)

In decentralized finance (DeFi), total value locked (TVL) is a measure of the value of assets deposited in different DeFi protocols, Brady writes.

• So, for example, lenders need assets to lend, so TVL measurements include all the deposits made into lending protocols, such as Aave.

Since the terraUSD stablecoin evaporated last week, total value locked is down across the ecosystem. DefiLlama, which tracks deposits across multiple blockchains, measured $205 billion deposited on May 5.

• Today, it reports $112 billion.

The bottom line: Right now, people are getting out.