A16Z Crypto, the blockchain investment arm of venture capital firm Andreessen Horowitz, has invested $50 million in Jito, a liquid staking protocol that underlies the Solana network.
The deal will give A16Z an unspecified allocation of Jito’s native tokens at a discounted rate, according to a Fortune report Thursday.
Brian Smith, executive director of the Jito Foundation, told Cointelegraph that the Jito Foundation has “an extraordinary long term,” and the investment “will allow the foundation to work to make Solana the home for internet capital markets well into the next decade.”
Jito is a Solana-based protocol based on Solana launched In 2022 it allows users to stake Sol Tokens to earn rewards while maintaining liquidity through its token, Jitosol. The Jito Foundation oversees protocol management and token distribution, while Jito Labs serves as the primary developer and infrastructure provider.
Andreessen Horowitz (A16Z) is a Silicon Valley Venture Capital Firm known for backing leading technology and crypto startups. The blockchain-focused arm, A16Z cRiptoInvested in Web3 infrastructure, decentralized financial technology and blockchain.
The deal follows a $55 million A16Z token purchase In Layerzero, a crosschain messaging protocol based in Canada, on April 17. In the same month, the firm Led a $25 million investment round on miden, a zero-knowledge (ZK) proof-of-concept blockchain from polygon labs.
Related: SEC Staff Liquid-Staking Guidance Leaves Regulatory Questions, May Be Disputed
US regulators debate liquid staking
Liquid staking, a process that allows users to stake tokens to secure a proof-of-stake blockchain and earn a yield while receiving a trade derivative token, has been at the center of the regulatory debate in the United States this year, and Jito Labs has a role to play in driving the conversation.
Rebecca Rettig, Chief Legal Officer at Jito Labs, led the first team to meet with the Trump administration. Smith said his work in securing clearer guidance around liquid staking paves for Jitosol’s integration with ETFs and ETPs – a “main part of the bull thesis for JTO.”
On July 31, Jito Labs joined asset managers Vaneck and bitwise in urging the SEC to allow liquid staking Within the eight proposed products traded by the Solana Exchange (ETP). The team said Liquid staking tokens provide a more efficient and resilient way to integrate staking into ETP structures.
Almost a week later, on August 5, the SEC’s Division of Corporate Finance released The guidance clarifies that some forms of liquid staking do not constitute security offerings, although it depends “on the facts and circumstances.”
While many Crypto and Defi communities While the statement was viewed as a positive development, not all SEC officials shared the sentiment. Commissioner Caroline Crenshaw criticized the guidancesaid “muddies the water” and urged liquid staking providers to proceed with caution.
Despite ongoing regulatory uncertainty, liquid staking protocols have become a key component of the decentralized financial ecosystem.
According to data from Defillama, Jito’s Liquid Staking Protocol is currently holding around $2.8 billion In total value locked (TVL), compared to $ 1.9 billion for Solana Competitor Marinade and approximately $33.9 billion For Lido, the leading Ethereum staking platform.
In July, the crypto fintech platform Moonpay entered the ring, announcing the launch of a Solana Liquid Staking Program offers users an annual yield of up to 8.49% on their SOL Holdings.
Magazine: Own your stake and earn fees too: Tushar Aggarwal on Double Dipping In Defi
