Why We Invested in Lossless

Master Ventures
4 min readMay 21, 2021


We are delighted to announce our investment in the first-of-its-kind DeFi hack mitigation platform, Lossless.

At Master Ventures, we believe in empowering projects that have transformative potential in their respective application areas. We invest in and work with projects founded on blockchain and other disruptive technologies, using our innovation to help them grow and scale them for mass adoption, giving them the potential of improving the way we live and interact.

Freezing Fraudulent transactions

The true potential of blockchain technology was displayed in 2020 as the DeFi market proliferated. By allowing users to control their finances and privacy directly, it was only a matter of time before DeFi exploded. However, it realized the security flaws that inherently exist in most DeFi applications, most notably the loss of over $120 million in 2020 from hacks targeting just 15 DeFi platforms.

Lossless noted that the problem with DeFi was the focus on prevention of losses solely. As such, they implemented another dimension to this; mitigation of losses. This idea garnered our interest as it provides a very compelling solution that would ultimately boost confidence in DeFi participation.

The idea behind Lossless is to prevent the loss of tokens by freezing fraudulent transactions. It monitors and detects hacks to help users retrieve their stolen funds from any attack. At its core, the protocol is a piece of code that token creators insert into their tokens, allowing Lossless to freeze any suspicious transactions based on a set of fraud identification parameters. To this end, Lossless uses a two-pronged approach designed to leverage the DeFi community and to decentralize the entire process.

Firstly, Lossless will introduce a proof-of-stake hack-finding platform that leverages the technological prowess of white hat hackers. White hat hackers are incentivized by the platform to innovate hack-identifying bots that automatically detect fraudulent transactions based on set parameters. Lossless will feature bot-friendly APIs to support the hack-stopping bots. Upon successful hack identification, the fraudulent transaction is frozen for a short-term period. The hack-spotters are publicly rewarded on the platform to encourage community participation and continuous hack-identifying innovation.

Secondly, following the flagged transaction, the Lossless Decision Making Body is introduced to overview and confirm the nature of the transaction. The Lossless Decision Making Body will be compromised among the following three parties:

  1. Lossless Committee (it will be formed among a mixture of auditing firms, investors with a significant share of $LSS tokens, and key public figures)
  2. Lossless Company
  3. Token Creators (those whose funds were hacked)

Upon verification of a hack, the transaction will be frozen long-term, with the body enacting a proposal to revert the stolen funds to the original address.

Before white hat hackers can start contributing, an initial open-source hack-spotting mechanism will be created by the data analyst team at Lossless. All suspicious transactions will be frozen for 24–48hrs using this mechanism.

Providing a safer and more secure platform for everyone

As previously mentioned, millions were lost during the ‘DeFi summer’ of 2020. Millions more are being lost and can continue to be lost in 2021 if nothing changes. Surprisingly, despite the existence of numerous cybersecurity platforms, none address the specific challenge of token loss through hacks. Luckily, Lossless is stepping up to fill the market gap left by cybersecurity companies.

The increased safety resulting from Lossless’ protocols is crucial in increasing investor confidence in the DeFi market. Without the safety net proposed by Lossless, the cryptocurrency/blockchain industry as a whole faces a grim future of ground-breaking technological marvels that are underutilized, stunted, and decaying due to the financial hemorrhage enabled by a lack of mitigating innovations.

Why did we invest?

Master Ventures closely watches promising technologies, gauging their potential to improve the cryptocurrency market, the blockchain ecosystem, and scale decentralization to more exciting levels. Lossless aligns with our ethos when deciding to support a project.

The platform addresses a fundamental issue that plagues DeFi platforms and the blockchain and centralized ecosystem. Issues surrounding the possible loss of minted tokens discourage community participation from innovative DeFi platforms, which can reduce the momentum in acceptance and use of decentralized applications.

Aside from their technical prowess, Lossless’s business acumen is also spot on. Because they occupy an important niche market, the platform can establish itself as a must-have for all DeFi focused decentralized applications. Its B2B market approach guarantees revenue from existing and emerging DeFi applications.

Through our investment, we believe that we are supporting an innovative team to help them realize their full potential, which is beneficial to Lossless, Master Ventures, and the entire blockchain community.

About Lossless

Lossless is the novel loss mitigation protocol following a crypto hack attempt. It uses a code implemented into a token, allowing the protocol to freeze and retrieve tokens in compromised or fraudulent transactions.

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About Master Ventures

Master Ventures is a blockchain-focused Venture Studio, helping to build the next generation of blockchain-based Web 3.0 system innovations within the crypto industry. Launched in 2018 by Founder and CEO Kyle Chassé, the company’s ethos can best be summarized in the acronym #BeBOLD: Benevolent, Open, Love, Decentralized.

Master Ventures co-creates with entrepreneurs and businesses worldwide to turn the best ideas into innovative and disruptive products. They do this by investing as strategic partners through offering advisory services to the projects they believe in. To date, Master Ventures has invested in over 40 crypto projects including the likes of Kraken, Coinbase, Bitfinex, Reef, DAO Maker, Mantra DAO, Thorchain, and Elrond.

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Website: https://master.ventures/

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