White Star Capital Digital Asset Fund - newsletter #48
Crypto market trends and the positive momentum of Q3 📊
Positive market tailwinds are pushing (some) crypto assets back up to all-time highs
The crypto market seems to be approaching its all-time high from earlier this year with all signs pointing towards continued strengthening of the market. Solana, for example, has seen continued building through the first half of the year and has already surpassed its previous all-time high. Why do we think the market is resurging? Put simply, the fundamentals have not changed. While the market saw drawdowns in Q2 2021, the projects building in the space have done the opposite – they’ve continued to build at a faster pace than before.
As we dig deeper into Genesis’s Q2 report we are finding many interesting notes on the broader crypto market. Activity in the broader market and at Genesis confirms the changing role of bitcoin (BTC) as the industry’s gateway asset and highlights the emerging protagonism of Ethereum and decentralized finance (DeFi). From late 2020 until the end of Q2 2021, BTC’s dominance in market cap declined from over 70% to under 45%. Ether (ETH) and prominent DeFi tokens more than doubled in price over that same period.
Bitcoin performance YTD
In spite of strong fundamental growth across the crypto asset industry, market sentiment shifted in Q2 to produce negative returns in most crypto assets. BTC fell by over 40%, breaking a run of four consecutive quarters with strong price gains. ETH, on the other hand, gained 18.4% on the back of technological progress in the underlying protocol and increasing interest in decentralized applications (dapps). The weak crypto market sentiment stood out against a backdrop of continued gains in principal macro market indicators supported by economic reopening in many areas. The S&P 500 was up over 10% in the quarter, commodity prices rallied sharply and most bond categories posted positive returns as longer-term interest rates dropped.
The contrast between the macro and crypto asset performance
What we’ve seen so far in the third quarter is pointing towards a reversal of the negative trends in the second quarter. If we’ll see a full continuation of the Q1 bull-run is still yet to be seen but we’re hopeful that long-term, this is only the beginning.
🔦 White Star & Portfolio Spotlight
New projects are building on top of Superfluid!
Check out Alethea AI’s newest iNFT
🏦 Enterprises & Institutions
PNC Bank planning crypto offering with Coinbase
PNC, the fifth-largest bank in the U.S., plans to offer crypto investment services to clients.
Neuberger Berman expands fund strategy to include bitcoin, ether exposure
A commodity-focused fund managed by Neuberger Berman, a multi-billion-dollar asset manager, has opened the door to exposure to bitcoin and ether derivatives and investment vehicles.
Samsung plans to test mobile phone functionality with South Korea’s CBDC pilot
The electronics giants will look at whether transactions can be completed without internet availability.
Walmart is looking for a crypto product lead
Walmart—America's most ubiquitous retailer—is on the hunt for a cryptocurrency product lead, according to a job ad posted to LinkedIn.
⚖️ Government & Regulation
Ghana to test CBDC
The digital cedi will be tested with banks, payment service providers, merchants, consumers and other stakeholders.
Valkyrie becomes latest firm to file for bitcoin futures ETF after Gensler comments
Securities and Exchange Commission chairman Gary Gensler recently appeared to express particular interest in exchange-traded products tied to bitcoin futures.
Investment firm Kryptoin files for ether ETF
As the SEC weighs approving its first bitcoin ETF, Kryptoin and others are getting in line for an ETH ETF.
Galaxy files for ETF that provides indirect exposure to bitcoin
Galaxy has filed with the Securities and Exchange Commission (SEC) for an exchange-traded fund that will invest in products with indirect exposure to bitcoin.
💰 Funding & Exits
Exactly raises $3m in seed funding to bring fixed income to DeFi
The seed round led by Kaszek and was joined by other investors such as 6th Man Ventures, Baires DAO, 11–11 DG partners, Newtopia VC, NXTP Ventures, and Sur Ventures.
DAOs & VCs put $6m behind governance startup Tally
Tally, a platform that builds governance infrastructure for decentralized autonomous organizations (DAOs), announced it raised $6m in a funding round led by Blockchain Capital and Placeholder.
Crypto tax and accounting platform Bitwave raises $7.25m
Blockchain Capital led the firm's seed round as VC bets on crypto tax plays pick up steam.
Crypto data analytics platform Dune raises $8m in Series A funding
New York-based Union Square Ventures led the round, with Redpoint Ventures and existing investors Dragonfly Capital and Multicoin Capital also participating.
Hashed has acquired 350,000 $SUSHI in the public market
Ex-Goldman Sachs traders raise $4m for DeFi risk management startup
The funding round was led by Pantera Capital. CoinFund, Protoscale Capital, The LAO and Digital Currency Group also participated in the round.
Blockchain security firm CertiK raises another $24m one month after its Series B
The new round was co-led by Tiger Global and GL Ventures.
World Mobile wraps $39m token sale to launch mesh network in Zanzibar
World Mobile is currently rolling out telecommunications equipment to establish a mesh network and bring internet connectivity to Tanzania.
Crypto staking firm Figment raises $50m in Series B funding round
Senator Investment Group and Liberty City Ventures co-led the round, with participation from Galaxy Digital, Anchorage, Declaration Partners, Bonfire Ventures, GSR, and others.
Solana’s Mango Markets DEX raises $70m in MNGO token sale
At its height, investors had plowed over $500 million in USDC into the trading platform’s 24-hour sale.
Crypto startup TaxBit is now valued at $1.33bn after new $130m funding round
Venture firms Insight Partners and IVP co-led TaxBit's Series B round.
Austrian crypto unicorn Bitpanda raises another $263m
The investment platform has now closed three rounds of financing in the past 12 months. British billionaire Alan Howard and REDO Ventures are the latest investors to back the business.
Polygon acquires Hermez in $250m deal that includes first-ever token 'merger'
Ethereum scaling project Polygon (formerly Matic Network) has acquired Hermez Network — a ZK-Rollups-based Ethereum scaling solution — for $250m. The two blockchain projects are also merging their native tokens — MATIC and HEZ — in the first ever such deal in the crypto space.
🚀 Project Launches & Updates
TikTok has integrated crypto audio project, Audius
🔥 Other Bits We're Excited About
Blockchain, crypto investment in H1 topped 2018-20 full-year totals: KPMG
Investment activity in blockchain and crypto reached $8.7bn as of June 30, more than each of the preceding three years.
Fortune raises over $1.3m in NFT sale of its latest issue's cover
The collection consisted of two parts: 256 limited-edition NFTs priced at 1 ETH each (around $3k at the time), and a set of three special-edition NFTs which were put up for auction on the OpeanSea marketplace.
Dolce & Gabbana sets date for haute couture NFT drop
“Collezione Genesi” NFTs will feature items personally designed by Dolce & Gabbana co-founders Domenico Dolce and Stefano Gabbana.