Blockchain infrastructure startup Alchemy, which helps decentralized finance (DeFi) projects run or access nodes, just launched its full suite of products to the public, after a two-year closed beta serving teams including MakerDAO and Kyber Network.
DeFi projects like MakerDAO, 0x and others all use Alchemy’s solutions to access Ethereum blockchain data, rather than run their own nodes. Alchemy CEO Nikil Viswanathan said more than 70% of top Ethereum applications and more than $2.8 billion worth of assets locked in DeFi rely on Alchemy for access to blockchain data.
“We’ve replaced all the infrastructure providers for most of them,” Viswanathan said, referring to “hundreds” of Ethereum startups that pay for Alchemy’s software services. One such user, Dapper Labs CEO Roham Gharegozlou, said in a press statement his startup relies on Alchemy for “managing infrastructure,” plus “enterprise-grade tools and support,” so the team can focus on shipping code.
It appears as though most Ethereum startups use one of three infrastructure providers, if not all three of them. For example, Infura, the rival service provider partially owned by Ethereum co-founder Joe Lubin, offers a similar API service. Bison Trails is the other major player in the Ethereum infrastructure trifecta.
Developers pay startups like Infura and Alchemy for access to distant hardware (typically managed by Amazon or Google) and tools to easily use blockchain data. This isn’t a “don’t trust, verify” approach, but it does make it easier for startups to focus on serving retail users.
“Right now, building with blockchain, it’s like trying to build a skyscraper with a hammer and a shovel. Alchemy is bringing the construction equipment so it’s easier to build things,” Viswanathan said. “We are a pipe to a decentralized network, there are other pipes and people can use whatever pipes that they want.”
From his perspective, having a remote-first company with deliberate redundancy offers a type of decentralization, albeit one divorced from bitcoin’s full stack of self-sovereign aspirations.
Behind the scenes
Viswanathan said his startup facilitated roughly $7.5 billion worth of on-chain transactions over the last year, from exchanges to loan platforms.
That may, in part, be thanks to the fact the startup attracted well-connected investors like Coinbase Ventures, which also invested in Bison Trails.
“As the de facto standard in blockchain, Alchemy already powers the most sophisticated teams,” investor Paul Veradittakit of Pantera Capital said in a press statement.
Even after an explosive year of growth, it’s not hard to imagine all the teams responsible for the DeFi ecosystem fitting in a single university lecture hall. In fact, both Alchemy co-founders graduated from Stanford University and attracted investment from their alma mater as well.
By making some of these services free to the public, Viswanathan said he aims to diversify the DeFi ecosystem.
“Our mission is to make blockchain development accessible to every developer,” Viswanathan said, describing the newly public beta. “Now anyone can sign up and use the same tools powering the biggest companies in crypto.”