Venture Capital

Where is voice tech going?

Posted by | Alexa, artificial intelligence, Baidu, Column, COVID-19, Extra Crunch, Gadgets, hardware, Headspace, Market Analysis, Media, Mobile, Podcasts, siri, smart speaker, Speech Recognition, Startups, TC, Venture Capital, virtual assistant, voice, voice assistant, voice search, voice technology, Wearables | No Comments
Mark Persaud
Contributor

Mark Persaud is digital product manager and practice lead at Moonshot by Pactera, a digital innovation company that leads global clients through the next era of digital products with a heavy emphasis on artificial intelligence, data and continuous software delivery.

2020 has been all but normal. For businesses and brands. For innovation. For people.

The trajectory of business growth strategies, travel plans and lives have been drastically altered due to the COVID-19 pandemic, a global economic downturn with supply chain and market issues, and a fight for equality in the Black Lives Matter movement — amongst all that complicated lives and businesses already.

One of the biggest stories in emerging technology is the growth of different types of voice assistants:

  • Niche assistants such as Aider that provide back-office support.
  • Branded in-house assistants such as those offered by BBC and Snapchat.
  • White-label solutions such as Houndify that provide lots of capabilities and configurable tool sets.

With so many assistants proliferating globally, voice will become a commodity like a website or an app. And that’s not a bad thing — at least in the name of progress. It will soon (read: over the next couple years) become table stakes for a business to have voice as an interaction channel for a lovable experience that users expect. Consider that feeling you get when you realize a business doesn’t have a website: It makes you question its validity and reputation for quality. Voice isn’t quite there yet, but it’s moving in that direction.

Voice assistant adoption and usage are still on the rise

Adoption of any new technology is key. A key inhibitor of technology is often distribution, but this has not been the case with voice. Apple, Google, and Baidu have reported hundreds of millions of devices using voice, and Amazon has 200 million users. Amazon has a slightly more difficult job since they’re not in the smartphone market, which allows for greater voice assistant distribution for Apple and Google.

Image Credits: Mark Persaud

But are people using devices? Google said recently there are 500 million monthly active users of Google Assistant. Not far behind are active Apple users with 375 million. Large numbers of people are using voice assistants, not just owning them. That’s a sign of technology gaining momentum — the technology is at a price point and within digital and personal ecosystems that make it right for user adoption. The pandemic has only exacerbated the use as Edison reported between March and April — a peak time for sheltering in place across the U.S.

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How Reliance Jio Platforms became India’s biggest telecom network

Posted by | Apple, Apps, Asia, bharti airtel, Extra Crunch, Facebook, india, Mark Zuckerberg, Market Analysis, Media, Microsoft, Mobile, Mukesh Ambani, payments, reliance industries, telecom, Venture Capital, vodafone, Vodafone Idea, Xiaomi | No Comments

It’s raised $5.7 billion from Facebook. It’s taken $1.5 billion from KKR, another $1.5 billion from Vista Equity Partners, $1.5 billion from Saudi Arabia’s Public Investment Fund$1.35 billion from Silver Lake, $1.2 billion from Mubadala, $870 million from General Atlantic, $750 million from Abu Dhabi Investment Authority, $600 million from TPG, and $250 million from L Catterton.

And it’s done all that in just nine weeks.

India’s Reliance Jio Platforms is the world’s most ambitious tech company. Founder Mukesh Ambani has made it his dream to provide every Indian with access to affordable and comprehensive telecommunications services, and Jio has so far proven successful, attracting nearly 400 million subscribers in just a few years.

The unparalleled growth of Reliance Jio Platforms, a subsidiary of India’s most-valued firm (Reliance Industries), has shocked rivals and spooked foreign tech companies such as Google and Amazon, both of which are now reportedly eyeing a slice of one of the world’s largest telecom markets.

What can we learn from Reliance Jio Platforms’s growth? What does the future hold for Jio and for India’s tech startup ecosystem in general?

Through a series of reports, Extra Crunch is going to investigate those questions. We previously profiled Mukesh Ambani himself, and in today’s installment, we are going to look at how Reliance Jio went from a telco upstart to the dominant tech company in four years.

The birth of a new empire

Months after India’s richest man, Mukesh Ambani, launched his telecom network Reliance Jio, Sunil Mittal of Airtel — his chief rival — was struggling in public to contain his frustration.

That Ambani would try to win over subscribers by offering them free voice calling wasn’t a surprise, Mittal said at the World Economic Forum in January 2017. But making voice calls and the bulk of 4G mobile data completely free for seven months clearly “meant that they have not gotten the attention they wanted,” he said, hopeful the local regulator would soon intervene.

This wasn’t the first time Ambani and Mittal were competing directly against each other: in 2002, Ambani had launched a telecommunications company and sought to win the market by distributing free handsets.

In India, carrier lock-in is not popular as people prefer pay-as-you-go voice and data plans. But luckily for Mittal in their first go around, Ambani’s journey was cut short due to a family feud with his brother — read more about that here.

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Investors say emerging multiverses are the future of entertainment

Posted by | augmented reality, Entertainment, epic games, Extra Crunch, Gaming, Market Analysis, Marshmello, multiverse, new horizons, Roblox, scooter braun, Social, social media platforms, Startups, TC, Travis Scott, Venture Capital, vidcon, Virtual reality | No Comments

The COVID-19 pandemic is accelerating the adoption of new technologies and cultural shifts that were already well underway. According to a clutch of heavy-hitting investors, this dynamic is particularly strong in gaming and extended reality.

Unlike other segments of the startup and tech world, where valuations have been slashed, early-stage companies focused on building new games, gaming infrastructure and virtual or extended reality entertainment are having no trouble raising money. They’ve even seen valuations rise, investors said.

“Valuations have increased pretty significantly in the gaming sector. Valuations have gone up 20 to 25% higher than I would have seen prior to this pandemic,” Phil Sanderson, a co-founder and managing director at Griffin Gaming Partners, told fellow participants on a virtual panel during the Los Angeles Games Conference earlier this month.

Driving the appetite for new investments is the entertainment industry’s bearhug of virtual events, animated features, games and social media platforms after widespread shelter-in-place orders made physical events an impossibility.

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The Great Reset

Posted by | Column, coronavirus, COVID-19, Entertainment, Extra Crunch, food, Gaming, Health, Market Analysis, Media, science, Social, Startups, Transportation, Venture Capital | No Comments
Ann Miura-Ko
Contributor

Ann Miura-Ko is a co-founding partner at Floodgate, a seed-stage VC firm. A repeat member of the Forbes Midas List and the New York Times Top 20 Venture Capitalists Worldwide, she earned a PhD in math modeling of cybersecurity at Stanford University.

Talk of an economic downturn can be frightening, especially one precipitated by a pervasive health crisis. At times, I’m overwhelmed by the images of countless patients on life-support and the near-endless streams of statistics regurgitating bad news.

Having started in venture at the beginning of two recessions, I’ve seen how the startup industry functions during economic trouble. My second day of work at Charles River Ventures was September 11th, 2001. My first project, analyzing the VC industry, propelled the firm to return more than 60% of its fund to investors, going from a $1.2 billion fund to $450 million. In May 2008, Mike Maples and I founded Floodgate in the midst of the Great Recession. We learned that great founders won’t wait for a better economic moment to start a company.

While we are currently embroiled in personal and professional circumstances unimaginable even three months ago, these very challenges will form the basis of incredibly innovative ideas. In order for the world to move forward, we need our greatest minds to imagine a brighter future and create solutions to make it a reality.

When I analyze our society and novel health situation, one thing is certain: COVID-19 is a paradigm-shifting event, creating massively accelerated social and economic change.

The Great Reset is not just another economic event

Our current situation is unique. It’s not merely a cyclical economic event, nor is it a standalone health crisis. What we are experiencing is not just an inflection point: it’s a societal phase-change unlike anything we have ever seen. We face an epic choice of how we move forward, and the decisions we make today will shape an entire generation.

Here’s why: COVID-19 is prompting us to reset many of our most fundamental behaviors. These changes are impacting our financial system, with effects visible throughout our homes, businesses and even the concept of “workplace” itself.

COVID-19 is pervasive

As a global pandemic, the virus itself has spread to nearly every country in the world.

Between February 20 and March 26, 100% of the world’s 20 largest economies implemented government-mandated social distancing. Globally, the number of scheduled airline flights is down 64%. In some countries, like Spain and Germany, flight numbers are down by more than 90%.

Since the timeline for lifting government restrictions is unclear — and even then, scientists are uncertain how the virus will spread — the question lingers: How long will this go on?

COVID-19’s impact is uncertain, long-term and potentially undulating, affecting every facet of our lives. You can’t simply wait it out with the expectation that industries will rebound. In 2001, September 11 felt pervasive, but its economic impact ultimately stemmed from just one single incident and the resulting fear… and that one single incident still cost more than three trillion dollars. How much larger will COVID-19 be?

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This Week in Apps: Houseparty battles Messenger, Telegram drops crypto plans, Instagram Lite is gone

Posted by | Apps, coronavirus, COVID-19, Extra Crunch, Gaming, hardware, Market Analysis, Mobile, Startups, Venture Capital | No Comments

Welcome back to This Week in Apps, the Extra Crunch series that recaps the latest OS news, the applications they support and the money that flows through it all.

The app industry is as hot as ever, with a record 204 billion downloads and $120 billion in consumer spending in 2019. People are now spending 3 hours and 40 minutes per day using apps, rivaling TV. Apps aren’t just a way to pass idle hours — they’re a big business. In 2019, mobile-first companies had a combined $544 billion valuation, 6.5x higher than those without a mobile focus.

In this Extra Crunch series, we help you keep up with the latest news from the world of apps, delivered on a weekly basis.

This week we’re continuing to look at how the coronavirus outbreak is impacting the world of mobile applications, including the latest news about COVID-19 apps, Facebook and Houseparty’s battle to dominate the online hangout, the game that everyone’s playing during quarantine, and more. We also look at the new allegations against TikTok, the demise of a popular “Lite” app, new apps offering parental controls, Telegram killing its crypto plans and many other stories, including a hefty load of funding and M&A.

Headlines

Contact tracing and COVID-19 apps in the news 

  • Global: WHO readies its coronavirus app for symptom-checking and possibly contact tracing. A WHO official told Reuters on Friday the new app will ask people about their symptoms and offer guidance on whether they may have COVID-19. Information on testing will be personalized to the user’s country. The organization is considering adding a Bluetooth-based, contact-tracing feature, too. A version of the app will launch globally, but individual countries will be able to use the underlying technology and add features to release their own versions. Engineers from Google and Microsoft have volunteered their time over the past few weeks to develop the app, which is available open-source on GitHub.
  • U.S.: Apple’s COVID-19 app, developed in partnership with the CDC, FEMA and the White House, received its first major update since its March debut. The new version includes recommendations for healthcare workers to align with CDC guidelines, best practices for quarantining if you’ve been exposed to COVID-19 and new information for pregnancy and newborns.
  • India: New Delhi’s contact-tracing app, Aarogya Setu, has reached 100 million users out of India’s total 450 million smartphone owners in 41 days after its release, despite privacy concerns. The app helps users self-assess if they caught COVID-19 by answering a series of questions and will alert them if they came into contact with someone who’s infected. The app has come under fire for how it stores user location data and logs the details for those reporting symptoms. The app is required to use Indian railways, which has boosted adoption.
  • Iceland: Iceland has one of the most-downloaded contact-tracing apps, with 38% of its population using it. But despite this, the country said it has not been a “game-changer” in terms of tracking the virus and only worked well when coupled with manual contact tracing — meaning phone calls that asked who someone had been in contact with. In addition, the low download rate indicates it may be difficult to get people to use these apps when they launch in larger markets.

Consumer advocacy groups say TikTok is still violating COPPA

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CRV’s Saar Gur wants to invest in a new wave of games built for VR, Twitch and Zoom

Posted by | augmented reality, consumer internet, coronavirus, COVID-19, CRV, Dropbox, Entertainment, Extra Crunch, Gaming, hardware, Kapwing, Market Analysis, niantic, Oculus Quest, Saar Gur, Social, Startups, TC, Twitch, twitch tv, unity, Venture Capital, Virtual reality, Xbox One | No Comments

Saar Gur is adept at identifying the next big consumer trends earlier than most: The San Francisco-based general partner at CRV has led investments into leading consumer internet companies like Niantic, DoorDash, Bird, Dropbox, Patreon, Kapwing and ClassPass.

His own experience stuck at home during the COVID-19 pandemic spurred his interest in three new investment themes focused on the next generation of games: those built for VR, those built on top of Twitch and those built for video chat environments as a socializing tool.

TechCrunch: We’ve been in a “VR winter,” as it’s been called in the industry, following the 2014-2017 wave of VC funding into VR drying up as the market failed to gain massive consumer adoption. You think VR could soon be hot again. Why?

Saar Gur: If you track revenues of third-party games on Oculus, the numbers are getting interesting. And we think the Quest is not quite the Xbox moment for Facebook, but the device and market response to the Quest have been great. So we are more engaged in looking at VR gaming startups than ever before.

What do you mean by “the Xbox moment,” and what will that look like for VR? Facebook hasn’t been able to keep up with demand for Oculus Quest headsets, and most VR headsets seem to have sold out during this pandemic as people seek entertainment at home. This seems like progress. When will we cross the threshold?

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VCs see opportunities for gaming infrastructure startups and incumbents

Posted by | Activision Blizzard, Amit Kumar, blockchain, discord, Extra Crunch, flashpoint, Gaming, Gigi Levy-Weiss, Investor Surveys, mobile game, online multiplayer games, overwatch league, Riot Games, Roblox, Startups, TC, Twitch, unity, Venture Capital | No Comments

As the infrastructure for developing games becomes more advanced, studios have turned to buying best-in-class technology from others instead of building everything from scratch (often with inferior quality).

This shift underpinned Unity’s rise as the most popular game engine. The current focus on games as ever-evolving social hubs that can remain popular for a decade requires investment in “live ops” to keep updating the game with new features and experiences, only adding to a game studio’s responsibilities.

There are big movements in gaming right now to make games cross-platform (not just restricted to mobile or PC or one console), incorporate new types of chat (in-game or outside of it) and to automatically remove bullies and bots among other things. Optimizing games’ virtual economies is only getting more complex as trade of virtual goods becomes increasingly popular.

All this means more opportunity for startups (and large incumbents) that provide new tools and platforms to game developers and gamers. To gauge which opportunities are prime for entrepreneurs, I asked four leading early-stage investors who focus on the gaming sector to share their analysis:

  • Sam Englebardt, Galaxy Interactive
  • Gigi Levy Weiss, NFX
  • Amit Kumar, Accel
  • Anton Backman, Play Ventures

Sam Englebardt, Galaxy Interactive

Which areas within gaming infrastructure seem firmly dominated by large incumbents, versus open for new startups to rise up?

I’m always rooting for the startup, but some of the really big and expensive infrastructure challenges seem unlikely to be solved by a startup, especially where the incumbents have a lead in time, money and the personnel they’re throwing at the problem. I’m thinking here, for example, about something like cloud computing, storage solutions, etc.

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7 VCs talk about today’s esports opportunities

Posted by | Advertising Tech, artificial intelligence, coronavirus, COVID-19, Entertainment, esports, Extra Crunch, Gaming, Investor Surveys, machine learning, Startups, TC, Venture Capital | No Comments

Even before the COVID-19 shutdown, venture funding rounds and total deal volume of VC funding for esports were down noticeably from the year prior. The space received a lot of attention in 2017 and 2018 as leagues formed, teams raised money and surging popularity fostered a whole ecosystem of new companies. Last year featured some big fundraises, but esports wasn’t the hot new thing in the tech world anymore.

This unexpected, compulsory work-from-home era may drive renewed interest in the space, however, as a larger market of consumers discover esports and more potential entrepreneurs identify pain points in their experience.

To track where new startups could arise this year, I asked seven VCs who pay close attention to the esports market where they see opportunities at the moment:

Their responses are below.

This is the second investor survey I’ve conducted to better understand VCs’ views on gaming startups amid the pandemic; they complement my broader gaming survey from October 2019 and an eight-article series on virtual worlds I wrote last month. If you missed it, read the previous survey, which investigated the trend of “games as the new social networks”.

Peter Levin, Griffin Gaming Partners

Which specific areas within esports are most interesting to you right now as a VC looking for deals? Which areas are the least interesting territory for new deals?

Everything around competitive gaming is of interest to us. With Twitch streaming north of two BILLION hours of game play thus far during the pandemic, this continues to be an area of great interest to us. Fantasy, real-time wagering, match-making, backend infrastructure and other areas of ‘picks and shovels’-like plays remain front burner for us relative to competitive gaming.

What challenges does the esports ecosystem now need solutions to that didn’t exist (or weren’t a focus) 2 years ago?

As competitive gaming is still so very new with respect to the greater competitive landscape of content, teams and events, the Industry should be nimble enough to better respond to dramatic market shifts relative to its analog, linear brethren. A native digital industry, getting back “online’”will be orders of magnitude more straightforward than in so many other areas.

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Venture investment in esports looks light as Q1 races to a close

Posted by | Chair, CrunchBase, esports, Extra Crunch, funding, Fundings & Exits, Fundraising, Gaming, league of legends, Startups, TC, United States, Venture Capital, video gaming | No Comments

Hello and welcome back to our regular morning look at private companies, public markets and the gray space in between.

Today we’re taking a look at the world of esports venture capital investment, largely through the lens of preliminary data that we’ll caveat given how reported VC data lags reality. That phenomenon is likely doubly true in the current moment, as COVID-19 absorbs all news cycles and some venture rounds’ announcements are delayed even more than usual.

All the same, the data we do have paints a picture of a change in esports venture investment, one sufficient in size to indicate that an esports VC slowdown could be afoot. As with all early looks, we’re extending ourselves to reach a conclusion. But… no risk, no reward.

We’ll start by looking at Q1 2020 esports venture totals to date, compare them to year-ago results, and then peek at Q4 2019’s results and its year-ago comparison to get a handle on what else has happened lately in the niche. The picture that the quarters draw will help us understand how esports investing is starting a year that isn’t going as anyone expected.

Venture results

Today we’re using Crunchbase data, looking at both global and U.S.-specific venture totals in both round and dollar volume. To get a picture of the competitive gaming world, we’re examining investments into companies that are tagged as “esports” related in the Crunchbase database. Given that this is a somewhat wide cut, the data below is more directional than precise and should be treated as such.

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Libra rival Celo launches 50-member Alliance For Prosperity

Posted by | Anchorage, Andreessen Horowitz, Apps, blockchain, Coinbase Ventures, cryptocurrency, Developer, eCommerce, funding, Libra, Libra Association, Mobile, payments, Polychain Capital, stablecoin, TC, Venture Capital | No Comments

Some Libra Association members like Andreessen Horowitz and Coinbase Ventures are double-dipping, backing a competing cryptocurrency developer platform. Launching today with over 50 partners, non-profit The Celo Foundation’s ‘Alliance For Prosperity’ offers a way for developers to build decentralized mobile apps that are based on Celo’s blockchain platform and USD stablecoin.

The open-source Celo platform is still in testing with plans to officially launch its mainnet in April. The non-profit founded in 2017 has raised $36.4 million, including its Series A where Andreessen Horowitz’s a16z Crypto bought $15 million worth of Celo Gold tokens.

The biggest differentiator of Celo’s network versus other blockchains is that payments in the Celo Dollar stablecoin can be sent to people’s phone numbers rather than complicated addresses. The goal is to make delivering utility via blockchain easier by building a flexible network of applications that doesn’t scare regulators like Libra has.
The Alliance For Prosperity includes Andreessen Horowitz (which funded Celo), Coinbase (Ventures), Bison Trails, Anchorage, and Mercy Corps — all of which are also Libra Association members. That could potentially create a conflict of interest regarding which cryptocurrency and developer platform they promote to their portfolio companies, integrate into their products, or focus on for delivering financial services to the needy.

Other high-profile Alliance partners include Carbon, GiveDirectly, Grameen Foundation, Maple, and Polychain. Partners have made a somewhat vague commitment to “backing development efforts of the project, building infrastructure, implementing desired use cases on the platform, integrating Celo assets in their projects, or collaborating on education campaigns in their communities to further advance the use of blockchain technology” according to Chuck Kimble, Celo’s cLabs head of business development and head of the Alliance. Anyone can apply to join the open network, and there’s no minimum financial investment like Libra’s $10 million prerequisite.

Celo isn’t trying to replace the dollar with its own synthetic currency, and its reserve is backed with other cryptocurrencies rather than fiat cash. That might make it more acceptable to regulators who were worried that Libra’s token and fiat currency bundle-backed reserve could impact the global financial system. The first of the decentralized apps on the platform, the Celo Wallet, is already available for iOS and Android.

Like many blockchain projects, there are some lofty intentions for social impact with Celo. Use cases include “powering mobile and online work, enabling faster and affordable remittances, reducing the operational complexities of delivering humanitarian aid, facilitating payments, and enabling microlending” says Kimble. The real driver of this potential is Celo’s promise of much lower transaction fees than traditional middlemen charge.

When asked what the biggest threats to Celo’s success are, he told me “Banking infrastructure improving faster than we expect” and “Mobile adoption or LTE data not expanding on their current trajectory.” He did not mention the developer fatigue, regulatory scrutiny, technical complexity, or slow adoption of blockchain utilities that have plagued other crypto for good projects.

Here’s the full list of members working towards these goals:

Abra, Alice, AlphaWallet, Anchorage, Appen, Ayannah, Andreessen Horowitz, B12, BC4NB (Blockchain for the Next Billion), BeamAndGo, Bidali, Bison Trails, Blockchain Academy Mexico, Blockchain.com, Blockchain for Humanity (b4h), Blockchain for Social Impact (BSIC), Blockdaemon, Carbon, cLabs, CloudWalk Inc, Cobru, Coinbase, Coinplug, Cryptio, Cryptobuyer, CryptoSavannah, eSolidar, Fintech4Good, Flexa, Gitcoin, GiveDirectly, Grameen Foundation, GSMA, KeshoLabs, Laboratoria, Ledn, Maple, Mercy Corps, Metadium, Moon, MoonPay, Pipol, Pngme, Polychain, Project Wren, SaldoMX, Semicolon Africa, The Giving Block, Utrust, Upright, Yellow Card, and 88i. [Update: Ledger joined this morning.]

“Many of these organizations have on-the-ground operations that will begin to get Celo into the hands of those who have been underserved by the current global financial system” Andreessen Horowitz general partner Katie Haun told me. “Our hope is that this partnership will start unlocking the potential of internet money”. To spur adoption, the Alliance will distribute ‘Prosperity Gifts’ in the form of financial grants to developers proposing Celo products that would benefit society. 

There are also some peculiar characteristics of Celo’s system. People exchange other cryptocurrencies for Celo Gold, then exchange that for Celo Dollars they can spend. The reserve is backed with other cryptocurrencies like bitcoin and ethereum rather that fiat, and isn’t fully collateralized. That could make it vulnerable to a Celo bank run or crash in price of those currencies. Celo also lets arbitrageurs pocket the difference if Celo Gold and Celo Dollars get out of sync.

While it might not be a danger to the world financial system like Libra, it could be a danger to itself. At least on the anti-money laundering front, cLabs — the team that’s kicking off development of the Celo platform — has hired former Capital One head of enterprise risk management Jai Ramaswamy. Plus, the Celo founders come well pedigreed, including Marek Olszewski and Rene Reinsberg who spun out machine learning startup Locu from MIT and sold it to GoDaddy, as well as EigenTrust inventor and former MIT Media Lab professor Sep Kamvar.

So far, 130 teams have expressed interest in building on the Celo platform. For reference, Libra said 1,500 organizations had said they wanted to work on that project four months after its reveal. Celo Camp and Blockchain for Social Impact Incubator will also be fostering projects for the blockchain.

Celo could make banking cheaper and more accessible while power new fintech innovation. But for any of that to happen, it will need to get enough developers building truly useful products, make the blockchain and currency exchange simple enough for mainstream audiences in developing nations, and grow adoption to meaningful levels few cryptocurrency projects have yet achieved. The Alliance For Prosperity will have to throw their weight into this project, not just their names, if it’s going to succeed.

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