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The crypto market is maturing.
Previously, a big problem with the industry was that data was hard to find and there were major questions about the validity of different data sets. This issue has recently jumped to the forefront after a Morgan Creek Digital portfolio company, Bitwise Asset Management, created a 226 page presentation for the SEC on why the public perception of Bitcoin market data may be inaccurate. The presentation is worth checking out.
Bitwise is in the asset management game though. There are a number of companies that have been created to address the market data issues. Here are a select few:
Digital Assets Data — the company has built a powerful enterprise-grade platform that allows fund managers and corporations to conduct analysis of blockchain-specific data in a more efficient way. The product is quickly becoming a go-to resource for the top organizations in the industry. It helps that the founders have previously built and sold a similar data company in the past, along with adding talent from Bridgewater Associates’ team that helped build portfolio generation and investment modeling tools. Check them out here. (I’m an investor)
Messari — the company is curating daily insights, market data, and research for clients. They acquired OnChainFX in recent months and combine the onchain data with proprietary analysis and tools. One of their big focuses in recent months has been an open source disclosures database called Messari Registry that aims to become a central repository for project information that can be freely accessed industry-wide. Check them out here.
Delphi Digital — the company is an independent research boutique providing institutional-grade analysis on the digital asset market. They have written incredibly in-depth pieces on Bitcoin and Ethereum, along with high-quality analysis on a number of smaller cap tokens and projects. The team comes from the equity research world and the work they produce meets the bar that the public equities market expects. Check them out here. (I sit on the board of directors)
In order for the industry to continue maturing, and for institutional investors to gain more confidence in allocating capital here, we will need to see continued maturation across various aspects of the industry’s data. Investors will need to be able to (1) locate the desired data easily, (2) access it in a user-friendly interface, (3) have confidence in the data’s validity, and (4) be able to massage and manipulate it in a way that drives decision making.
I am personally excited to see cleaner, more structured data being used. The more we know, the better everyone is positioned to make sound investments. The crypto industry was operating in the dark for the better part of ten years, but finally there appears to be a light at the end of the tunnel.
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Peter Thiel-Backed Crypto Brokerage Tagomi Just Got Its BitLicense: Tagomi, an institutional investor-focused crypto brokerage backed by Peter Thiel, received approval to do business in New York on Wednesday with a BitLicense from the Department of Financial Services. Following a roughly seven months-long application process, the New Jersey-based firm will now be able to work with institutional clients based in the world’s financial center—making it the 18th company to receive a BitLicense, a permit which allows companies to buy and sell virtual currency for customers in New York. Read more.
Börse Stuttgart, Axel Springer to Jointly Launch Crypto Trading Venue: Germany’s second largest stock exchange Börse Stuttgart is partnering with European digital publishing titan Axel Springer and its subsidiary Finanzen.net to jointly launch a blockchain-powered trading venue. The new initiative will aim to combine investment information services and a blockchain-powered trading venue under the canopy of one platform. Read more.
TechCrunch Founder’s Crypto Fund Tops $100 Million, Completes First Acquisition: One of Arrington XRP Capital’s largest limited partners has injected a fresh $30 million into the digital asset firm, according to its founder Michael Arrington. “The reason is, like everyone, we didn’t do particularly great last year, but we did better than the market. And that was a win,” Arrington told CoinDesk. With the additional investment, Arrington says the fund has now surpassed its initial target of raising $100 million. Read more.
Pantera Capital Nears $175 Million Target for Third Venture Fund: Cryptocurrency hedge fund Pantera Capital is close to completing funding for its third venture fund, already raising $160 million. Pantera, which debuted its first fund in 2013, has since risen to become a conspicuous player in the crypto startup industry. Its latest project, dubbed Venture Fund III, has a fundraising target of $175 million. “We project making a total of 35 investments, with an average deal size of $3.5 million, and an 11% target average equity stake,” the blog post revealed. Read more.
E-Commerce Giant Rakuten Wins License for New Crypto Exchange: Japan’s top financial watchdog has granted a license to a cryptocurrency exchange being relaunched by e-commerce giant Rakuten. The country’s Financial Service Agency announced the news Monday, stating that the new exchange, Rakuten Wallet, is now registered with the Kanto Local Financial Bureau as a virtual currency exchange service provider under the country’s Payment Service Act. Rakuten also confirmed the news in a separate statement. Read more.
Interested in crypto research? Look no further. The premier research firm in the space, Delphi Digital, has two subscription offerings for individuals and institutions alike. Take a look at their Bitcoin and Ethereum reports to get a taste of their analysis. [Click here]
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Nothing in this email is intended to serve as financial advice. Do your own research.