The phrase “pivot from crypto to AI” became a refrain in Silicon Valley after the launch of ChatGPT in 2022. The opportunistic founders sought to leapfrog from a feeble hype cycle to something newer and shinier in technology. However, Vladimir Novakovsky has turned from artificial intelligence to cryptocurrencies, and has attracted elite investors to back his startup Lighter, one of the fastest-growing projects in digital assets.
Lighter is a decentralized exchange designed to not be controlled by a single entity in addition to the blockchain. It allows users to trade perpetual futures contracts, a type of derivative that allows traders to speculate on the future prices of cryptocurrencies. Spot trading of tokens such as BitcoinNovakowski got.
Lighter announced Tuesday that it has raised $68 million in a new funding round. According to the 40-year-old Novakowski, who founded Lighter in 2022 and serves as CEO, the fundraising was led by Peter Thiel’s Founders Fund and fintech investor Ribbit Capital. Other participants include Haun Ventures and online brokerage Robinhood, which rarely make legitimate investments.
The round valued Lighter at about $1.5 billion, according to two sources familiar with the deal, who requested anonymity to discuss private business transactions. Novakowski declined to comment on Lighter’s valuation, but said the deal was for shares and token collateral, or an allocation to a cryptocurrency that has not yet been issued.
“What we want to do is be the infrastructure layer that makes sure that everything that happens in finance happens fairly, happens correctly, and happens transparently,” Nowakowski said in an interview.
Trading to artificial intelligence for trading
Lighter’s fundraiser comes amid a wave of hype around “perps,” or perpetual, cryptocurrencies. These are popular derivatives in the cryptocurrency industry and allow traders to hold futures contracts that do not expire, provided the necessary margin requirements are maintained.
While so-called crimes have been around for years, the recent rise of Hyperliquid, another decentralized exchange, has shaken the market. With just 11 employees, Hyperliquid co-founder Jeff Yan has been able to challenge centralization giants like Binance, which has responded by closely aligning itself with its Hyperliquid competitor: Aster.
The lighter is entering a highly competitive market, but Nowakowski has had enough Intellectual pieces To compete. “Vlad and the team he built are 85% to 90% of the reasons we made this investment,” said Joey Krug, partner at Founders Fund. luck.
After Novakowski immigrated from Russia to the United States as a child, he earned a spot on the U.S. national team for the International Olympiad in Informatics and Physics. At the age of 16, he went to Harvard University, graduated early, and at just 18 years old, he started working at the hedge fund Citadel Investment Group. (Novakowski said he was personally recruited by Citadel CEO Ken Griffin.)
Nowakowski then worked for about 15 years in various companies as an engineer and trader before becoming a founder himself. In 2017, he and Scott Wu, with whom Nowakowski previously worked at investment firm Addepar, founded their startup together: Lunchclub, an AI-powered platform for social media.
They raised about $30 million, and at the beginning of the pandemic, they saw their product attract a large group of isolated users looking to meet new people. But in 2022, growth stabilized. “We had three paths, which were: trying to turn it into something profitable but small, and trying to figure out a way to go from what it was to like TikTok or Snapchat“Path Three: Focus on something else that we were really passionate about,” said Nowakowski, which didn’t seem particularly viable.
Wu left Lunchclub to found AI programming startup Cognition, which has been active ever since Achieve With a value of $10.2 billion, Nowakowski decided to return to his roots as a trader.
He spun Lunchclub into Lighter, retained 80% of the team, and raised a new amount of capital: $21 million in a previously unreported round in 2024 led by Haun Ventures and Craft Ventures. Other participants include Dragonfly and Robot Ventures. This, combined with Leiter’s latest round, brings the amount Leiter has raised to date to about $90 million.
After two years of development and testing, Lighter was launched in January. Unlike Hyperliquid, which operates on its own first layer of the blockchain, Lighter operates on its second layer. Ethereumwhich Nowakowski cited as a key differentiator between the two competing products.
Lighter’s blockchain has quickly become one of the top 2 blockchains on Ethereum in terms of total volume locked, or the total amount of funds on the blockchain, according to data from cryptocurrency analytics website L2BEAT. Nowakowski said his business is already profitable. “We’re very happy with where we are right now, but we’re working hard,” he added when asked how his product compares to Hyperliquid’s.
