White Star Capital Digital Asset Fund - newsletter #55
Looking back at another record breaking quarter 🎥
NFT trading volume surges 700% to $10.7bn in Q3
The last two months have been an explosion for the NFT market. August was a record-breaking month with over $5.2bn in trading volume. In September, the volumes slowed down from the blistering August numbers, but still, the numbers are impressive. In Q3, the NFT space generated over $10.7bn in trading volume. This represents an outstanding 704% increase from the previous quarter and a colossal 38,060% increase year-over-year. Simply remarkable.
There is not a single but multiple reasons behind the outstanding performance. The space is evolving completely. NFT projects are finding their way to become more than simple profile pictures. Furthermore, they are becoming brands. Renowned celebrities like Snoop Dogg, Shaquille O’Neal and Steve Aoki are amongst the latest members to join exclusive communities, further strengthening the social outlook of the NFT space.
The mainstream media coverage is expected to grow even further. Top fashion brands like Gucci, D&G and Burberry have been involved in the NFT space in recent months. In August, Burberry launched a skin collaboration with Blankos Block Party, an important game metaverse, whilst D&G completed the sale of a digital fashion collection featuring new pieces on September 27th, selling for a total of $5.65m.
What’s even more dizzying is the record sale prices we’ve been seeing in the figure below – we believe Q4 will match if not exceed the below records:
Besides the undeniable mainstream signal provided by celebrities and big brands, there is another aspect that is gaining relevance in the industry: the utility offered by owning a NFT. The projects are getting creative. Whether by receiving additional NFT drops (Meebits, Punks Comic, etc.) or by generating passive income, these NFTs are finding a way to reward their owners beyond the art itself.
For example, projects like CyberKongz and SupDucks provide holders with passive income by holding their respective NFTs. In the case of CyberKongz, a Kongz holder receives 10 BANANA daily as yield. At the current BANANA price, this translates to $497 per day. Not bad if you do the math.
All in all we expect Q4 to match or exceed the NFT records set in Q3!
🔦 White Star & Portfolio Spotlight
ParaSwap has launched their new market maker pools
Meet Rally’s newest creators, athletes and artists
Superfluid: the programmable cash flows of the future
Check out this new deep dive on our favorite money streaming protocol!
🏦 Enterprises & Institutions
Private-equity giant KKR makes first blockchain investment in ParaFi fund
The investment firm has also created a working group to focus on best use cases for blockchain technology.
Visa working on interoperability platform for stablecoins, CBDCs
The channel would allow cryptocurrencies to be transferred between different blockchains.
Société Générale applies for $20m MakerDAO loan using bond token collateral
One of the largest banks in France is working with one of the largest protocols in DeFi on a historic step toward institutional adoption.
Leading Republican on House Financial Services Committee introduces bill to establish a safe harbor for digital tokens
Derived from a longstanding proposal from the SEC’s Hester Peirce, the bill was introduced by republican leadership of the House Financial Services Committee, alongside new scrutiny for SEC Chairman Gary Gensler.
Bank of America launches research for ‘too large to ignore’ digital assets
The nation’s second-largest bank by assets starts coverage three months after creating a crypto research group.
U.S. Bank partners with NYDIG to offer bitcoin custody services
U.S. Bank is now offering crypto custody services to its institutional clientele in the U.S. or Cayman Islands.
⚖️ Government & Regulation
Bank of England unveils CBDC forum members, including reps from Asos, PayPal and Spotify
The formation of two forums was announced in April to explore a potential UK CBDC that would exist alongside cash and bank deposits.
New Zealand’s Reserve Bank seeks public input on digital dollar before December deadline
The bank said in its papers that it sees trends in the use of cash which “present an opportunity” to consider broadening central bank money.
El Salvador has started mining bitcoin with volcanos
El Salvador has mined some bitcoin using geothermal energy, according to its president. The set up is still being tested and installed but some bitcoin is already trickling in.
SEC delays decision on 4 bitcoin ETFs
The agency extends its review of applications from Global X, Kryptoin, Valkyrie and WisdomTree by 45 to 60 days.
Hong Kong explores technical aspects of a retail CBDC
Hong Kong’s central bank has published a technical whitepaper for a potential retail digital currency.
💰 Funding & Exits
Float Protocol raises $1.2m to create a truly decentralized, non-dollar stablecoin
DeFi DAOs such as MCV and The LAO participated in the treasury diversification in addition to strategic partners including Eden Block, Stani Kulechov from Aave, 0xMaki from Sushiswap and others.
Kokoa Finance raises $2.3m seed round
The round was led by Hashed and joined by Sky Vision Capital, a41 Ventures, and a number of individual angel investors.
Talisman raises $2.35m to unite the Paraverse
The seed round was led by Hypersphere Ventures and supported by numerous DotSama ecosystem funds and founders.
DAO infrastructure platform Layer3 raises $2.5m in seed funding
ParaFi Capital led the round, with Electric Capital, Lattice Capital, 6th Man Ventures, Red Beard Ventures, and Mirana Ventures also participating.
Crypto treasury management platform Coinshift raises $2.5m in seed funding
Investors included Sequoia Capital India, Weekend Fund (founded by Product Hunt founder Ryan Hoover), ConsenSys Mesh, DeFi Alliance, Ethereal Ventures, Fintech Collective, and Gnosis, among others.
Roco Finance raised $3.6m in seed funding
Investors include Alameda Research, Huobi Capital, Avalaunch and others.
ThorChain-based DEX ThorSwap raises $3.75m in a private token sale
IDEO CoLab Ventures led the round, with True Ventures, Sanctor Capital, THORChain, Nine Realms, Proof Group, 0xVentures, Qi Capital, and others participating.
Unlock raises $4m funding round
Investors include Betaworks, Cygni Labs, GMG Ventures and Metacartel Ventures China, along with participation from early investors.
Multi-chain crypto wallet XDEFI raises $6m in new funding
Mechanism Capital led the round, with participation from DeFiance Capital, Alameda Research, Sino Global Capital, Animoca Brands, CoinGecko, and Morningstar Ventures, among others.
Crypto custodian Hex Trust raises $10m
Animoca Brands, a gaming and non-fungible token startup, led the round.
Gelato Network raises $11m in Series A funding
Dragonfly Capital led the round, with ParaFi Capital, Nascent, IDEO CoLab Ventures, and Stani Kulechov, founder and CEO of Aave, also participating.
Zero Hash eyes expansion in DeFi, NFTs after raising $35m
The funding round was led by the venture arm of Point72, the firm helmed by Steven Cohen.
a16z leads funding round for Forta
Forta is an enterprise-grade runtime security platform whose goal is to detect threats and other system critical issues as quickly as possible.
Warsaw-based crypto startup Ramp hits $300m valuation in Series A raise
British venture capital firm Balderton Capital is leading the round.
Axie Infinity creator announces $152 million in Series B funding
The round was led by Andreessen Horowitz (a16z), with participation from Accel and Paradigm.
DeSo launches $50m fund for decentralized social ecosystem
The Octane Fund will fuel development of early-stage social media projects for the blockchain.
Arca closes $30m venture fund as it crosses $500m in AuM
Dubbed Endeavor, the fund will back companies in the non-fungible token market as well as companies operating in blockchain-based gaming and Web 3.0.
SBI, Sygnum, Azimut establish $75m VC fund for crypto startup investments
The fund will invest in companies focused on building DLT, DeFi, and RegTech tools.
Ripple launches $250m NFT fund
Creators, brands and marketplaces will be given support to explore how the XRP blockchain can support new use cases for NFTs.
Dapper Labs acquires Lil Miquela creator Brud to build a unit focused on DAOs
The firm says the acquisition will help it build a new business unit focused on decentralized autonomous organizations (DAOs).
Crypto analytics startup Chainalysis acquires cybercrime forensics firm Excygent
Exycgent is a highly specialized technology firm that services both public and private clients, even assisting U.S. governmental agencies with cybercrime investigations.
SBI Holdings acquires SmartApp, to enter NFT business
SBI will now change the company name to SBI NFT Co. Ltd. and its shareholding ratio will be 80%.
🚀 Project Launches & Updates
ConsenSys-backed Palm blockchain to host DC Comics NFT drop
The legendary comics company has tapped the layer 2 network for the release that pays homage to its illustrious history.
TikTok announces NFT collection led by top creators
The newly announced TikTok Top Moments will feature six "culturally significant TikTok videos" as one-of-one NFTs from creators including Lil Nas X, Rudy Willingham, Bella Poarch, Curtis Roach, Brittany Broski, FNMeka, Jess Marciante and Gary Vaynerchuk.
Shaq to release NFT collection
After purchasing his first two NFTs last week, the Hall of Fame basketball player and businessman is releasing his own collection on Oct. 15.
🔥 Other Bits We're Excited About
NFL and Dapper Labs plan to launch an American football-focused NFT market
Sports Business Journal reported on the deal, citing anonymous sources. The site reported that the NFL and NFLPA will acquire equity in Dapper Labs, and that the new American football NFT marketplace is predicted to arrive before the end of this year’s football season in early January of 2022.
San José mayor partners with Helium to help lower internet costs for low-income residents
The San José Mayor's Office, the California Emerging Technology Fund (CETF) and Helium have partnered to install Helium miners throughout San José.