EthSign Receives Investment From Animoca Brands to Build Token Management Platform
FEBRUARY 20, 2023 — EthSign, the decentralized electronic signature platform, announced today it has received investment from Animoca Brands, the company driving digital property rights via NFTs and gaming. The investment follows the recent launch of EthSign’s new product, TokenTable, a platform that helps Web3 projects execute, track, and enforce the agreements a project uses to distribute their tokens.
Animoca Brands seeks to advance digital property rights for gaming and the open metaverse through both development and investment efforts. With a growing portfolio of over 380 projects in Web3, Animoca Brands understands the need for EthSign’s TokenTable and sees great promise in the solution.
EthSign’s first product, Signatures, allows users to sign legally binding agreements with their public keys, thus creating on-chain records of consent to contractual terms. Earlier this year, EthSign closed a historic $12M seed round led by Sequoia Capital India and Mirana Ventures. The company’s innovative infrastructure heralds a new era of non-financial, decentralized applications with real utility, and has attracted angel investors and VCs including Balaji Srinivasan, Alex Shin, and Tess Ventures.
“We started by building on-chain verifiable e-signature and intentionally generic smart contracts to execute agreement terms,” said Xin Yan, CEO of EthSign, “and now we are building TokenTable, a vertical use case for both technologies.”
Token allocation in many blockchain projects is often a highly manual, error-prone, and arduous process for everyone involved: founders lack a means to manage the distribution of tokens to investors, employees, and their communities; investors in pre-token-launch crypto projects do not have a way to automatically receive tokens upon launch; employees in Web3 have to trust the founder’s word that they will eventually receive tokens they were promised.
At the root of this problem is a lack of technological and legal industry standards mediating the necessary processes, because legal contracts are enforced by law, while smart contracts are enforced by code.
To solve this problem, EthSign created TokenTableThe impact of EthSign infrastructure can potentially be industry-wide, as token allocation is required in cap table management, token warrant/grant payouts, community airdrops, and more.
Animoca Brands invested in EthSign as an early supporter of TokenTable. Having launched various utility tokens including REVV and SAND for its own play-and-earn ecosystems, Animoca Brands is very familiar with the unique challenges of manually planning, executing, and managing tokenomics.
As an investor in hundreds of Web3 companies, Animoca Brands is frequently the recipient of token allocations. Many of these portfolio companies have issued tokens either in place of or in addition to equity. Manually keeping track of the unlocking schedules of tokens from hundreds of different projects is no small feat. Both quantity and timing of token distribution are often subject to human error, but with TokenTable, companies like Animoca Brands no longer have to worry about either being a problem.
Historically, a big problem surrounding token allocation has been the amount of back and forth that goes on between projects and investors. Whether to discuss and agree to terms of a deal, confirm that conditions have been met, or confirm payment, over-correspondence can cause confusion, delays, errors, and miscommunication.
By moving fundraising processes on-chain with TokenTable, the terms of any agreements are written into smart contracts, and the data are permanently recorded on blockchain.
Yat Siu, the executive chairman and co-founder of Animoca Brands, has remarked in the past how critical it is for crypto-native payment and transaction solutions to address the financial needs of Web3 projects. He believes that TokenTable, as such a solution, will help simplify the tedious processes of token allocation that are becoming unavoidable as token warrants continue to grow in popularity.
Commenting on the subject, Yat Siu noted: “Many projects use excel spreadsheets to calculate and track token allocation and unlocking, which is inefficient, not secure, and highly inconvenient. EthSign’s TokenTable addresses these challenges to enable a new standard of operational efficiency for Web3 businesses, and here at Animoca Brands we are proud to back the development of this highly useful solution and the growth of EthSign.”
With its hundreds of investments in Web3 projects, Animoca Brands is a perfect example of the companies that EthSign seeks to help with TokenTable. Many Web3 investors face the administrative challenges of having to manually manage their portfolios and track unlock schedules while considering the visibility of their portfolios on-chain. As a one-stop shop for token allocation, TokenTable seeks to keep all stakeholders informed at every stage of token ownership by making the process transparent and automated.
Crypto-native solutions are better suited to address the problem described above, and EthSign, having already familiarized itself with the legal and technological intricacies of facilitating contractual agreements on-chain, is particularly well positioned to do so.
TokenTable puts terms of legal agreements into the smart contract, thereby ensuring that the investment terms of every agreement signed on the platform are executed — this is a major step in bolstering the rule of law with the rule of code.
Noting his belief in the potential impact of EthSign’s infrastructure, Rohit Agarwal, Partner at Sequoia Capital India, said, “EthSign is unlocking the full potential of smart contracts by making it easy for organizations and individuals to seamlessly adopt and incorporate them in their daily workflows and business scenarios. We believe it can become the de-facto platform for multiparty collaboration and consensus across both Web2 and Web3.”
About EthSign
EthSign is building a suite of non-financial, decentralized applications that enable entities to sign legally binding agreements and thus conduct business on the blockchain. In 2022, EthSign raised a $12M seed round from all three units of Sequoia Capital and launched the beta version of its first product, EthSign Signatures. Over 150,000 documents have been signed on the platform. EthSign recently launched the open beta of its second product, TokenTable, a platform that facilitates the planning, execution, and management of token allocation. Check out TokenTable at http://www.ethsign.xyz/tokentable
