On June 28th, 2022 Venture Capitalist Nic Carter announced he was “Excited to be backing” identity-based wallet company, Dynamic. 

Dynamic XYZ’s goal is to usher in “the adoption of wallet-based authentication and identity.” The company announced that they raised $7.4 million during a seed round of funding led by Andreessen Horowitz (a16z). 

The idea is to use your wallet with all your hosted transaction history and other private data to be linked to your online identity. You would use your wallet to sign into websites and other online services. Essentially, it would be one username and password for all platforms. 

The company tweeted that “We have been dreaming of building a lasting company for over 15 years. We first met at MIT, two Israelis just out of the IDF’s intelligence corps. At Dynamic, we have been fortunate to partner with the world class team that’s built what you see today.” The misalignment of incentives here is what sparked criticism from Bitcoiners on Twitter. 

This type of control would allow Dynamic to stop payments for any reason the company sees fit. 

When Carter announced the investment in the identity focused crypto wallet, accounts on Twitter were very critical. Samson Mow, the CEO of JAN3, tweeted to Carter that the move was “not something to be proud of.” Later, Carter implied that nation state adoption was losing momentum this cycle because of Mow’s involvement with nations seeking to adopt Bitcoin. 

Carter doubled down by saying, “If you have any issues with what I or my firm invests in, please go ahead and unfollow.” Carter was able to invest in Dynamic through his VC firm Castle Island.

This comes on the heels of a Solana (SOL) chain freeze in which a whale with 1,000,000 votes took over and paused the chain. Not for the sake of its users, but so a large holder could avoid liquidation. Despite the backlash from Solana users, the largest stakeholders invalidated the vote.

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