Karak, a Middle Eastern Restaking project with a valuation of 1 billion, has a luxurious financing background but is questioned by the community
Written by: Frank, PANews
Recently, the Restaking track has become one of the important narratives in the Layer2 track. From Eigenlayer's TVL quickly breaking through $10 billion to Ether.fi breaking through $3 billion, the market has responded enthusiastically. Projects in the Restaking track have almost become the focus of market attention, but Karak, which has a luxurious lineup of investment institutions, seems to be an exception.
Karak is a kind of milk tea popular in the Middle East, and the name highlights its regional background. In December 2023, Karak announced that it had received $48 million in Series A financing at a valuation of more than $1 billion, led by Lightspeed Venture Partners, with participation from Mubadala Capital, existing investors Pantera Capital, Framework Ventures, Bain Capital Ventures, Digital Currency Group, Coinbase, Proof Group, Nima Capital, Naval Ravikant and other institutions. Among them, Mubadala Capital is the second largest fund in Abu Dhabi, and most of the other investors are well-known investment institutions in the traditional and crypto circles. However, it is worth mentioning that Nima Capital sold a large number of its holdings last year.Tokenand real estate,CommunityQuestioning "rug".
On February 28, Karak announced the launch of an early access program, where users can earn XP points by re-staking on Karak, but the response was mediocre. On April 8, a private channel was opened. As of April 9, Karak's total TVL was $100 million. This level of TVL was "incompatible" with its luxurious endorsement lineup, and there was a constant stream of questioning voices on social media.
According to the official introduction, Karak is a universal re-staking network, similar to Eigenlayer and other re-staking projects, which also uses the points gameplay to encourage users to re-stake and obtain multiple benefits. Currently, Karak has supported Ethereum mainnet, ArbXiaobai Navigationitrum（L2）、K2（L2) and other networks. Its team members come from companies such as Coinbase, Google, AWS, Microsoft, Twitter, and Goldman Sachs.
Currently, the TVL on Karak is about $100 million, which is comparable to EigenLayer ($13 billion),ethThere is a huge gap between the TVL of er.fi ($3 billion). On the one hand, it may be because Karak is still in the early access program stage. But the more likely reason is fromCommunityThere are many questions about the background of the project.
According to IAN (@cryptoian) said that the team behind Karak is the Risk Harbor team, which was once an asset risk insurance service provider in the Terra ecosystem. The project previously ranked second in TVL in the Terra ecosystem and suffered heavy losses in the Terra crash. Twitter user @RayRaspberry1 said that the team embezzled 100,000 yuan in the process of withdrawing from Terra.Community 200 million UST (worth $7 million) in funding.
Karak's CSO (Chief Strategy Officer) Victor Cheng responded to this on Twitter, saying that the funds were awarded to the Risk Harbor Foundation, which was minted by the Terra Foundation, as collateral for our risk pool. After the UST collapsed, in order to prevent further losses, the Risk Harbor Foundation sold $6 million worth of UST from the initial grant. These funds are currently designated as an insurance fund for the initial recosting pool.
Perhaps in order to break away from past controversies, Risk Harbor has changed its name to Andalusia Labs. Andalusia Labs has launched three products: Karak (layer2 network), Subsea (digital asset risk management market, formerly Risk Harbor), and Watchtower (digital asset agencySafetyplatform).
But such a response apparently did not completely dispel the community's doubts about Karak. One user commented: "All their posts are about getting XP points through re-staking. They never mentioned progress, construction, technology, ecosystem development, etc." As of now, the number of people in Karak's Telegram channel is about 5,700, which does not seem to match the tens of millions of financing. In addition, the details of the platform's XP usage plan have not yet been announced. If Karak wants to increase its TVL, the first step may be to eliminate the "public relations crisis."
The article comes from the Internet:Karak, a Middle Eastern Restaking project with a valuation of 1 billion, has a luxurious financing background but is questioned by the community
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