Paradigm Invests in New Layer 2 Blockchain

Prolific crypto venture capital firm Paradigm announced on Friday a $20 million investment in Ithaca, a spinoff company focused on developing a new Layer 2 blockchain called Odyssey.

Leadership and Technology

Georgios Konstantopoulos, Paradigm's Chief Technology Officer and General Partner, will serve as Ithaca's CEO. The Layer 2 solution, powered by Reth and the OP Stack, is currently live on testnet.

> "Think of Ithaca as the company that is building the full stack of products and tools that developers need to ship faster and that consumers need to have less and less friction," Konstantopoulos explained.

Paradigm views Ithaca as part of its portfolio, with co-founder Matt Huang serving as chairman. The firm is known for investments in companies like Uniswap, Coinbase, and Flashbots, and for developing open-source tools like Reth and Foundry, used in projects like Optimism and Worldcoin.

Accelerating Crypto Development

Konstantopoulos emphasized that Ithaca and Odyssey represent a continuation of Paradigm's prior development work. He stated, "Crypto must go faster," stressing the need for increased innovation and rapid iteration to achieve advancement in the crypto space.

Differentiation in Layer 2 Solutions

When discussing how Odyssey differs from existing Layer 2 solutions, Konstantopoulos described it as a "Layer 2 from the future." He highlighted that Odyssey will include features from Ethereum's roadmap that haven't yet been built by other teams, aiming to provide more robust smart wallet contracts.

> "More powerful, smart contract wallets means frictionless onboarding for crypto, which is solving one of the most important problems," he stated.

Layer 2 networks enhance scalability for Layer 1 blockchains, allowing networks to manage a greater volume of transactions efficiently. Popular examples include Polygon on Ethereum and the Lightning Network on Bitcoin.

Konstantopoulos clarified that although Paradigm continues building and researching, forming companies like Ithaca shouldn't indicate a trend towards more spin-offs, stating, "We are by no means an accelerator or something like that."