Today we check in on a couple of startups. One is more established, and one is brand new. Why? Because this is building season.

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Today's newsletter is 1,015 words, a 4-minute read.

🍊 1 big thing: A crypto lender that 2022 didn't sink

Illustration: Sarah Grillo/Axios

It's been said that all the crypto lenders blew up in 2022, but that's not quite true. Unchained Capital is a lender that never blew up and seems to be doing better than ever, Brady writes.

  • Earlier this month the firm announced it had raised $60 million to expand its product offerings, in a Series B round led by Valor Equity Partners.

Why it matters: It proves out the model of conservative lending based on cryptocurrency.

What they're saying: "There's a lot of ways the world has continued to provide great case studies of why you need and want something like bitcoin," Joe Kelly, CEO and co-founder of Unchained tells Axios.

  • Every time the world reminds people that money in banks isn't really in their control, Unchained sees inbounds, he said.

Examples Kelly mentioned included: The monetary expansion in the early part of the pandemic. The blocking of donations for the trucker protests in Canada.

  • "Things get spooky in the financial system, and things like bitcoin seem more real and more credible."

Context: There are three important things to understand about Unchained. It is bitcoin-only, it offers a free custody product and it doesn't lend customers' bitcoin deposits to others.

Zoom in: Unchained lends dollars (not stablecoins) against bitcoin as collateral. That's the only kind of lending it does. Its target client is a high net-worth individual who has more bitcoin than cash.

  • It builds relationships with its free custody product. Basically, you get two keys to your bitcoin, Unchained holds one. Spending bitcoin requires a two-of-three signature.
  • Be smart: This means they can help you recover your holdings if you lose one key, but the firm can't take your bitcoin on its own.
  • Lastly, it only takes in bitcoin as collateral against loans. So it doesn't offer interest on bitcoin deposits, as other lenders did. That's because it doesn't lend the bitcoin out. It's just collateral.

"We never did anything more sophisticated with bitcoin than just keep it safe," Kelly said.

In the weeds: Kelly says its borrowers use the funds for much the same thing retail bank borrowers use it for: buying homes, buying other property, starting businesses, etc.

  • According to Kelly, very little of its lending is for leveraged bets on more bitcoin or other cryptocurrencies.

Of note: Lending and custody aren't its only lines. It also has a trading desk, offers inheritance services and retirement accounts.

The bottom line: Over the short term, people can lose a lot of money on bitcoin, but Unchained targets bitcoiners who have played the long game, who have generally done very well.

  • That's why its custody service is free. It's a way to get in with new bitcoiners before they become the sort of clients who might need a dollar loan.
  • "It's a business strategy. These are clients from a new market that we think can be lifelong," Kelly said.

💳 2. A startup for digital consumers

Illustration: Shoshana Gordon/Axios

Digital goods and services are too hard to buy right now, so Coinflow has created a way to buy them with a credit card, Brady writes.

Why it matters: For people who just want to participate in web3 activities (think video games or exclusive online communities), buying in is way too complicated. Coinflow promises to simplify all that, so everything can be done in one transaction.

What they're saying: "We're looking to just keep expanding chains that have products we can integrate with," co-founder Daniel Lev tells Axios.

How it has worked: For someone who is new to crypto, a first-time purchase can be pretty complicated (described in detail here). You need to pick a wallet app, make a wallet, create an account on an exchange, buy some cryptocurrency, move it, and so on.

How Coinflow works: To be clear, a project has to incorporate the service. Once there, Coinflow has smart contracts set up that arrange for the purchase to work over traditional payment rails.

  • The company with the service will get a payment for the item in cryptocurrency, but the customer will never hold it.
  • Lev explained that it works sort of like a gift card or a voucher the user's wallet holds for a moment, just before the client company sends that wallet the item they're buying.

To stay on the right side of the law, Coinflow only integrates with projects after anti-money-laundering and know-your-customer obligations are met. Each customer also has to go through such a check.

The bottom line: The idea is that there will be more and more consumer goods in the digital space, and Coinflow is aiming to gain a share of that market.

😶‍🌫️ 3. Charted: Gone

Data: CoinGecko; Chart: Axios Visuals
Data: CoinGecko; Chart: Axios Visuals

Voyager, and the people it owes, has been left in the lurch, again, Crystal writes.

Driving the news: Binance's US unit walked away from an agreement to acquire bankrupt crypto lender Voyager Digital's assets.

  • Voyager's token sank on the news, though, the price of VGX — at around 30 cents as of late yesterday afternoon — remains above its post-bankruptcy low, according to data compiled by CoinGecko.

Quick take: Voyager creditors have been through the wringer of deal-or-no-deal just in the last few months, first with FTX's involvement, then Binance and then, the U.S. government.

🏹 4. Catch up quick

💰 FTX agrees to sell futures exchange LedgerX for $50 million. (FTX)

ğŸŽ® The FTX-acquired game SBF always played during phone calls, Storybook Brawl, is shutting down. (Bloomberg)

🚨 Ten members of Terraform Labs staff were indicted. (KBS)

Top coins

Performance of select cryptocurrencies
Data: CoinGecko; Table: Axios Visuals

💀 5. Culture hash: "Skull of Satoshi" to Fidelity

Screenshot: @CleanUpBitcoin (Twitter)

A little while back we told you about the "Skull of Satoshi" statue by Benjamin Von Wong. Since then, the organization that commissioned it, Greenpeace, has apparently been using it to draw attention to its direct actions, Brady writes.

Driving the news: Greenpeace has taken its campaign to get Bitcoin to switch its code to the same model used by Ethereum and other blockchains, proof-of-stake, to Fidelity.

The latest: Their efforts got them an op-ed in The Guardian that has bitcoiners stewing this morning.

This newsletter was edited by Pete Gannon and copy edited by Carolyn DiPaolo.

If you're in Austin for Consensus, look for Crystal. She'll be around, starting later today. —C & B