Sony, the Japanese juggernaut with its hands in video games, consumer tech, and even banking, has invested $3.5 million in Startale Labs, the developer behind one of Japan’s homegrown blockchains.
The investment is direct and there are no other backers in the round, Sota Watanabe, the CEO of Startale, told Fortune. He declined to provide the company’s implied valuation.
“We have already been cooperating with Startale Labs by jointly hosting incubation programs, aiming to promote the development of Web3,” Jun Watanabe, president and executive officer of Sony’s internet arm, said in a statement. “With this capital partnership, we are merging Startale Labs' knowledge and technical capabilities in Web3 with the experience and business fields cultivated by Sony Network Communications.”
Sony’s Jun Watanabe will also be appointed as director of Startale, per the investment agreement.
The injection of capital from Sony in a Web3 company comes as the blockchain industry’s center of gravity looks outside Silicon Valley to the Asia and Pacific markets, given the ongoing regulatory uncertainty in the U.S. amid the federal government’s recent crackdown on crypto.
Hong Kong and Singapore have emerged as crypto hubs, and even Japan’s ruling party has weighed in on Web3 and is seeking to position the country as an industry center.
“The U.S. government is hesitant to make crypto usable. Regulation is getting tighter and tighter,” Sota Watanabe told Fortune. “China, Singapore, Japan, and Korea think this is an opportunity.”
Recently gracing the cover of Forbes Japan, Watanabe is one of the primary developers behind the Astar Network, a layer-1 blockchain built on top of Polkadot, a protocol that connects blockchains.
I am honored to be on the cover of the latest issue of Forbes Japan! Thanks for the Christmas gift @forbesjapan 🎁
— Sota Watanabe (@WatanabeSota) December 23, 2022
Astar is getting a lot of tractions and recognition in Japan. We keep building and try to lead web3 in Japan. pic.twitter.com/5lnIQcsHju
The Astar Network—Japan’s “most famous layer-1 blockchain,” says Watanabe—is proof of stake, like Ethereum. However, developers can get paid in the network’s native token, ASTR, if the Astar community deems their application to be legitimate and useful.
“Developers are the most fundamental human resource in Web3,” Watanabe told Fortune.
The Startale CEO added that his firm of 15 employees is not only focused on working on the Astar Network but also contributing to Polkadot. In addition, they are developing a project for Ethereum; however, Watanabe declined to give more details.
Sony’s $3.5 million investment in his company will help Startale hopefully double its number of employees to 30, but Startale and the Japanese giant already have an existing relationship. In February, the two teamed up to launch an incubation program for projects that focus on non-fungible tokens and decentralized autonomous organizations.
