Wolf’s Clothing is the first startup accelerator that focuses on the Bitcoin Lightning Network and the Taro protocol, and it was founded by asset management company Stone Ridge, the parent company of Bitcoin company NYDIG (Wolf).
Wolf’s Clothing (Wolf), a startup accelerator founded by asset management company Stone Ridge will be focused on fostering the development of Bitcoin-related products, the team exclusively revealed to TechCrunch.
According to Kelly Brewster, CEO of Wolf, the program will bring four cohorts per year to New York City from all over the world for eight weeks at a time to concentrate on building on the Bitcoin-centric Lightning Network and Taro protocol. Each cohort will be made up of eight to twelve teams, or roughly 30 to 50 founders.
How Will It Work?
Built on top of Bitcoin, the Lightning Network is a layer-2 payment system that seeks to facilitate quicker payment processes. Separately, the Taro protocol was introduced in April of this year to assist in the issuance of digital assets on the blockchain of Bitcoin that can then be instantaneously transferred to the Lightning Network in low-fee transactions.
Brewster stated, “It’s like creating an HTTP accelerator; they’re both generic and useable enough in such a wide range of applications. Though it is a specialized technology, the business use cases can be very diverse. However, we have a significant competitive advantage due to our intense concentration, which can be a major attraction for founders.”
Small startup teams and early-stage enterprises will all be represented in the accelerator by teams. According to Brewster, they will each get an investment of $250,000, and one cohort winner will also receive an additional $500,000 for a total of $750,000.
Micropayments and tipping using Lightning and Taro are two topics that Brewster is eager in seeing entrepreneurs develop.
Along with training and funding from operating businesses and venture capital firms with a focus on bitcoin, NYDIG, a division of Stone Ridge, is also supporting the accelerator. According to Brewster, the names of the companies contributing outside funding won’t be disclosed. But he also pointed out that all mentors and investors are already using Lightning and Bitcoin. This includes public fintech and banking companies, as well as specialized VCs, focused on Lightning up.
Bitcoin Lightning Network
- A layer-2 payment mechanism called Lightning Network, which was developed on top of Bitcoin, seeks to give the blockchain rapid payments and scalability at a reasonable price. It enables users to send or receive Bitcoin quickly by conducting transactions outside of the primary blockchain network, or, as Coinbase put it, “like an HOV lane on a highway.”
- At Stone Ridge, we’ve been keeping an eye on Lightning for a while, Brewster said, “Over the past 12 months, the network has reached critical mass, and there is enough capacity today that real-world activities can be conducted on the network with relative ease.”
- Brewster remarked that Lightning had grown extraordinarily over the previous year. In some ways, it is the ideal time to take a step back and determine where there is a signal and where there is only noise. Lightning is generating some of the most distinct signals right now. The rate of expansion and network capacity has been glacial.
- The announcement comes at an unusual moment for NYDIG, which, according to a Wall Street Journal report published last week, recently let go of around 33% of its workforce. NYDIG raised $1 billion in December 2021, valuing the business at over $7 billion, according to the company.
Numerous cryptocurrency accelerator programs are emerging all across the ecosystem. Some of them range from generic web3-focused tools like Alliance DAO to layer-2 blockchain-specific accelerators like Polygon. While some startups provide funding, as Wolf intends to do, others invite investors to demo days in the hopes that they will fund the startups’ initiatives. In situations like this, Brewster asserted, “the businesses that are developed will capture these secular patterns and truly take hold as they accelerate.” Therefore, we believe that now is the ideal time to create rather than try to do something at Stone Ridge ourselves. We want to support and enable hundreds of other founders.