Crypto Venture Capital Chronicles #4

Capital update – Crypto projects aren’t necessarily funded by selling tokens, and thankfully so. After the ICO mania of 2017, many entrepreneurs have returned to the basics of startup funding: venture capital – or venture capital.

In “The Venture Capital Chronicles,” we bring you a digest of venture capital highlights, news and fund moves in the digital asset sector.

For this fourth chapter, discover a focus on Ark Invest’s investment thesis, the fundraising of the moment and a mysterious anonymous venture capital fund.

The Venture Capital Chronicles are brought to you in collaboration with Trading du Coin and its algorithmic trading solution finally accessible to individuals

Ark, a decidedly maximalist Bitcoin investment fund

Historically, technological innovations such as the steam engine, electricity, the combustion engine and the internet have transformed humanity. They gave rise to new industries and other innovations that led to tremendous economic expansion.

As investors, we need to embrace the power of innovation and try to understand what technologies are next that will transform society. Cathie Wood, CEO and founder of Ark Invest, has understood this need. In the Big Ideas 2021 report, she gives us her vision of tomorrow’s technology world. And, this vision includes Bitcoin. Indeed, the report identifies 5 key sectors broken down into 15 ideas for 2021. These 5 technologies are artificial intelligence, DNA sequencing, robotics, energy and blockchain. Two of these 15 ideas therefore focus on cryptospheres, and more specifically on Bitcoin.

Bitcoin a digital currency backed by robust fundamentals according to Ark Invest

Since the summer of 2020, Bitcoin has been receiving signs of interest and support from institutional players. As of July 2020, theOffice of the Controller of the Currency (OCC) has allowed US banks to offer digital asset custody services. In the same vein, the OCC has allowed these same banks to hold reserves in stablecoins. In July 2020, MicroStrategy announced its massive investment in Bitcoin. All of these reasons led Ark to predict a bright future for Bitcoin in 2021, and the maximalist bitcoin investment fund was right.

<img width=”1489″ height=”659″ src=”//www.w3.org/2000/svg’%20viewBox=’0%200%201489%20659’%3E%3C/svg%3E” alt=”Timeline of institutional player interest marksel for Bitcoin from Ark Invest’s Big Ideas 2021 report tracking the year 2020.” Chronologie des marques d'intérêt des acteurs institutionnel pour Bitcoin issue du rapport Big Ideas 2021 d'Ark Invest retraçant l'année 2020.Timeline of institutional interest in Bitcoin – Source: Ark Invest

According to Ark Invest, one of the reasons for Bitcoin’s success is the long-term view taken by investors. This view is partly driven by the fact that Bitcoin is a scarce resource that may be difficult to acquire in the future. A significant portion of investors are therefore jealously guarding their satoshis, with no intention of selling them. This can be seen in the growing number of bitcoins held for more than 5 years. Ark Invest has understood this and has included Bitcoin in its asset portfolio, albeit in conservative proportions. We will see why later.

Indicateur HODL Waves de Bitcoin sur la période 2010-2020 indiquant que les investisseurs conservent leurs bitcoins sur le long terme.Bitcoin’s HODL Waves indicator over the period 2010-2020 – Source: Ark Invest

Ark Invest does not mention the Ethereum network and decentralized finance (DeFi) in its Big Ideas 2021 list, but recognizes their potential. However, Cathie Wood’s investment fund believes that Ethereum’s success is largely due to the adoption of

See also  TikTok bans influencers from promoting cryptocurrencies

Bitcoin.

Capitalisation du marché des stablecoins et montants engagé dans les protocoles de DeFi montrant une forte croissance des deux secteurs tout au long de l'année 2021.Stablecoin market capitalization and amounts committed to DeFi protocols – Source: Ark Invest

Nevertheless, the study highlights DeFi’s ability to disintermediate traditional finance in that it allows participants to access a wide range of services in a decentralized manner. The reason Ark has not yet taken a close look at DeFi is probably because the sector is still largely experimental.

Bitcoin is gearing up for the era of institutional players

As mentioned earlier, the interest and support of traditional financial players has been a major contributor to Bitcoin’s popularity in 2020-2021. Throughout the first quarter of 2021, announcements from institutional players entering the cryptosphere have been coming in thick and fast, culminating in Tesla’s investment in Bitcoin and Coinbase’s IPO

. <img width=”1513″ height=”648″ src=”https://journalducoin-com.exactdn.com/wp-content/uploads/2021/07/image-37.png?strip=all&lossy=1&quality=66&ssl=1 1513w, https://journalducoin-com.exactdn.com/wp-content/uploads/2021/07/image-37-324×139.png?strip=all&lossy=1&quality=66&ssl=1 324w, https://journalducoin-com.exactdn.com/wp-content/uploads/2021/07/image-37-218×93.png?strip=all&lossy=1&quality=66&ssl=1 218w, https://journalducoin-com.exactdn.com/wp-content/uploads/2021/07/image-37.png?strip=all&lossy=1&quality=66&w=384&ssl=1,384w, https://journalducoin-com.exactdn.com/wp-content/uploads/2021/07/image-37.png?strip=all&lossy=1&quality=66&w=768&ssl=1 768w, https://journalducoin-com.exactdn.com/wp-content/uploads/2021/07/image-37.png?strip=all&lossy=1&quality=66&w=1152&ssl=1 1152w” alt=”Events giving Bitcoin credibility according to Ark Invest from regulators, banks, institutional investors and listed companies” />Lists ofevents giving Bitcoin credibility according to Ark Invest – Source: Ark Invest Volume journalier de négociation de Bitcoin sur les marché au comptant atteignant 6 milliards de dollars en 2020 quand le volume moyen du titre Apple est de 10 milliards de dollars par jour.Bitcoin daily trading volume in the cash market – Source: Ark Invest

During the 2017 bull run

, Bitcoin’s daily trading volume reached $8 billion before crashing and then stagnating. At the time of writing, Bitcoin’s daily volume was $6 billion. These amounts far exceed the average volumes of Europe’s most prestigious stocks and were already rivaling US tech titans like Apple and Square. <img width=”1920″ height=”1008″ src=”https://journalducoin-com.exactdn.com/wp-content/uploads/2021/07/bitcoins-adjusten-on-chain-volume-daily-1920×1008.png?strip=all&lossy=1&quality=66&ssl=1 1920w, https://journalducoin-com.exactdn.com/wp-content/uploads/2021/07/bitcoins-adjusten-on-chain-volume-daily-324×170.png?strip=all&lossy=1&quality=66&ssl=1 324w, https://journalducoin-com.exactdn.com/wp-content/uploads/2021/07/bitcoins-adjusten-on-chain-volume-daily-218×114.png?strip=all&lossy=1&quality=66&ssl=1 218w, https://journalducoin-com.exactdn.com/wp-content/uploads/2021/07/bitcoins-adjusten-on-chain-volume-daily.png?strip=all&lossy=1&quality=66&w=384&ssl=1,384w, https://journalducoin-com.exactdn.com/wp-content/uploads/2021/07/bitcoins-adjusten-on-chain-volume-daily.png?strip=all&lossy=1&quality=66&w=768&ssl=1 768w, https://journalducoin-com.exactdn.com/wp-content/uploads/2021/07/bitcoins-adjusten-on-chain-volume-daily.png?strip=all&lossy=1&quality=66&w=1152&ssl=1 1152w, https://journalducoin-com.exactdn.com/wp-content/uploads/2021/07/bitcoins-adjusten-on-chain-volume-daily.png?strip=all&lossy=1&quality=66&w=1536&ssl=1 1536w” alt=”Daily trading volume on the Bitcoin network surpassing $15 billion in 2021.”/>DailyTradingVolumeon the Bitcoin Network – Source: The Block

During the first quarter of 2021, trading volumes reached and then surpassed the symbolic $10 billion daily mark, the average volume of Apple stock on the NASDAQ. However, as mentioned earlier, this comparison is not really relevant. Bitcoin is traded day and night (168 hours per week), while US stocks are only available at fixed hours (32 hours per week

). For Ark Invest’s comparison to be truly relevant, similar time samples should be used. Corrélation de Bitcoin avec les différentes classe d'actifs montrant une faible corrélation avec l'ensemble des classes d'actifs.Correlation of Bitcoin with different asset classes – Source Ark Invest

The Big Ideas 2021 report concludes its section on Bitcoin by stating that the king of cryptos deserves its place in any properly diversified portfolio. First of all, Bitcoin has a low correlation with all asset classes analyzed by Ark Invest. Moreover, it is the only asset to have this property. Bitcoin is the only asset that has no strong correlation with any other asset class.

For these reasons it has a place in a diversified portfolio. According to Ark’s analysts

Invest, the right proportion of bitcoins in a portfolio would be 2.55% of the capital if you want to minimize the impact of its volatility. On the contrary, to maximize the risk reward of investing in Bitcoin one would have to invest 6.55% of the capital. As mentioned earlier, Ark Invest has a small, almost negligible exposure to Bitcoin compared to the amounts invested by Tesla or MicroStrategy. This would appear to be a result of its analysts’ recommendations.

Disruptive technologies according to Ark

Among Ark Invest’s 15 Big Ideas, the success of some will necessarily impact the rise of Bitcoin and the crypto ecosystem.

See also  Venezuela: Bitcoin miners in Carabobo get back online

According to Ark’s research, virtual worlds represented a $180 billion market in 2020. By 2025, this market would be valued at $390 billion with an average market growth of 17% over the next 5 years. Games and other immersive experiences are becoming a common place to meet and exchange, just like the office or the home.

The recent success of non-fungible tokens (NFTs) and theemergence of metaverse within the cryptosphere would support Cathie Wood’s ambitious fund prediction. With the proliferation of in-game

purchases and the growing interest in digital objects, the phenomenon of monetizing virtual worlds should positively impact the cryptosphere. And, Ark intends to invest in the most promising companies in this sector. Croissance des revenus généré à l'intérieur des jeux video un segment de choix pour les acteurs du capital-risqueGrowth in in-game revenue (in-game purchases) – Source: Ark Invest

If we had to name just one other idea from Ark Invest, it would be the advent of digital wallets. Ark Invest strongly believes that digital wallet applications are the most effective way to generate revenue from in-game purchases.

In the coming years, new fund applications (Cash App, Lydia) and neo-banks (N26, Revolut

) will disrupt the banking sector. Today these apps fit into many segments, stock brokerage, loans, banking, insurance and many others. Répartition des leaders du secteur des portefeuilles numériques, un secteur d'avenir pour Ark Invest qui estime qu'un client de ces portefeuilles pourrait valoir jusqu'à 20 000  $.Breakdown of digital wallet industry leaders – Source: Ark Invest

These new apps would, according to Ark, be ideal platforms for financial service providers to acquire new customers. In the same way that Robinhood

sells its users’ trading data, these platforms could market their customers’ data in order to offer them free services. According to Ark’s estimates, a customer could be worth between $10,000 and $20,000. The companies operating these applications would therefore be prime targets for venture capitalists.

Raises of the moment

BitDAO

BitDAO, a Decentralized Autonomous

Organization (DAO) dedicated to financing DeFi projects, raised $230 million in its first round of funding. This new project led by Peter Thiel, serial investor and co-founder of PayPal, wants to create a more inclusive financial system.

  • Current valuation: $230 million
  • Total amount raised: $230 million
  • Notable investors: Pantera Capital, Dragonfly Capital, Peter Thiel, Alan Howard

InstaDapp, a project that aims to become a one-stop shop for DeFi, raised $10 million in a ve

nte of its governance token the INST. InstaDapp is a little-known project revealed by Coinbase Ventures, which just took second place in DeFi’s ranking of projects for funds committed to the protocol.

  • Current valuation: N/A
  • Total amount raised: $12.4 million
  • Notable investors: Coinbase Ventures, Naval Ravikant, Pantera Capital, Standard Crypto

Valkyrie

Valkyrie

, a fund operator specializing in alternative assets, raised $10 million in its Series A round. The company currently offers three funds: one dedicated to Bitcoin and the other two to Polkadot (DOT) and Algorand (ALGO). The company is also one of the contenders to be the first provider of a Bitcoin ETF in the US. But, the Securities and Exchange Commission does not seem to be in a hurry to decide the issue. In the meantime, Valkerie intends to strengthen its presence in Asia.

  • Current Valuation: N/A
  • Total amount raised: $12.1 million
  • Notable Investors: UTXO Management, Consolidated Trading, 10X Capital, Justin Sun, Charlie Lee

Blockware

Blockware

, a Chicago-based bitcoin miner, has raised $25 million in a Series B funding round. With this fundraising, the company has ordered over 14,000 ASIC devices dedicated to bitcoin mining. This influx of mining equipment will allow the company to get its Kentucky site up and running. In addition, once

See also  Putin forces citizens to disclose their digital assets

all the devices are operational Blockware is expected to triple its hashrate.

  • Current Valuation: N/A
  • Total amount raised: $27 million
  • Notable Investors: N/A

Zerion

Zerion

, a protocol aggregator from DeFi, raised $8.2 million in its Series A round.

Zerion allows its users to access over 60 DeFi protocols from a single platform. Zerion gets part of its success from its focus on the user interface. The platform offers a clean interface that is much more accessible than those of the competition

.

  • Current Valuation: N/A
  • Total amount raised: $10.2 million
  • Notable Investors: Digital Currency Group, Lightspeed Venture, Blockchain.com Ventures

eGirl Capital, venture capital made In Twitter

When it comes to crypto, it’s never easy to determine what’s real and what’s not, never easy to know which project to put your trust and funds in. That’s the prevailing sentiment in a recent release from the DeFi Alliance, which announced its 11 new members. Among them are Chainlink, Blockchain.com and a mysterious Twitter-born venture capital fund: eGirl Capital.

<a href=”https://journalducoin-com.exactdn.com/wp-content/uploads/2021/07/image-40.png?strip=all&lossy=1&quality=66&ssl=1″ target=”_blank” rel=”noopener”>Profil Twitter du fonds de capital-risque eGirl Capital, un fonds anonyme contribuant à des projets de DeFITwitter profile of the venture capital fund eGirl Capital – Source: Twitter

EGirl Capital was previously unknown to our teams, yet the pop culture internet fund brings together some particularly popular crypto analysts. Members of eGirl Capital, such as loomdart and Degen Spartan, are known for their insightful analysis of notoriously complex markets as well as their quirky, satirical publications. For example, loomdart has nearly 200,000 followers on twitter and mewn21 regularly publishes extremely in-depth analyses in series of ten or so tweets. However, almost all eGirl Capital members are anonymous, they don’t use a profile picture or their real name.

The only real identifiable person within the fund is Eva Beylin who is also the director of The Graph Foundation

, which works to develop The Graph ecosystem. Liste des membres d'eGirl Capital, un fonds de capital-risque anonyme, identifiés à travers leur profil Twitter respectifsComposition of eGirl Capital – Source: eGirl Capital

Although it may be tempting to relegate eGirl Capital to the status of a private joke that has gone too far, the venture capital fund does appear in official press releases. The group participated in a 4.9

million for the DeFi Alchemix protocol and also announced investments in Radicle and Unisocks. Nevertheless, we couldn’t find any information related to the fund’s financing.

As another well-known Twitter user would say, the emergence of eGirl Capital was actually inevitable. The plurality of its members and their experiences combined with their anonymity, their taste for memes and internet culture make them perfect representatives of the cryptosphere. At least the initial aspirations of the latter. Self-educated people who don’t take themselves seriously while striving to build the technologies of tomorrow.

Have a great week on the Coin Journal!

Is it possible to be a winner every time?is it possible to be a winner every time? Whether Bitcoin’s price is in great shape, or going through turbulence, Coin Trading can help you increase your chances of success. Indeed, Trading Du Coin gives individuals access to a 100% automated algorithmic trading tool. Real trend mechanism, this tool was designed to adapt to market reversals and position on the most dynamic crypto assets of the moment.