White Star Capital Digital Asset Fund - newsletter #39
Welcoming the newest member to the Digital Asset team, and a continued flurry of newsflow
Welcoming Neil Harounian to the White Star Digital Asset Team!
After a rigorous search process, we are glad to welcome Neil Harounian as an Associate on our team, based in NYC! Neil joins us with investment banking, venture capital, and digital asset experience, and was notably one of our fellow co-investors in Ledn at Exponential Ventures. Neil will be a core member of the team and is always available to catch up on the latest in blockchain and crypto!
Outside our internal updates, this week has seen multiple 9-figure funding rounds as well as the passing of legislation in El Salvador to make bitcoin legal tender. We believe this legislation may cause a domino effect with other emerging and Latin American countries and will accelerate adoption.
Elsewhere, we’ve been extremely interested in the continuing evolution of narratives around bitcoin. Following Musk’s environmental concerns a few weeks ago, from which he recently showed a more open attitude after dialogue with the community, we’re now seeing macro hedge fund manager Paul Tudor Jones recommending a 5% portfolio allocation to bitcoin on CNBC.
Just as fascinating is Michael Saylor’s continued buying spree of bitcoin on MicroStrategy’s balance sheet. Hours after MicroStrategy completed the sale of $500m in bonds to purchase bitcoin, the firm said it plans to sell up to $1bn in stock to potentially acquire even more bitcoin. Ahead of this bond offering, the company held 92,079 bitcoin, worth close to $4bn. With his latest capital raises, Saylor could bring that total to north of $5.5bn, even with the recent market volatility.
Saylor has also helped form the newly announced Bitcoin Mining Council, which as he describes it is a “voluntary and open forum of Bitcoin miners committed to the network and its core principles.” The council aims to promote transparency, share best practices, and educate the public on the benefits of bitcoin and bitcoin mining.
We believe Saylor and the Bitcoin Mining Council will play an important role in shedding a positive light on the bitcoin narrative against broader, and in some cases, misunderstood environmental concerns (eg 76% of miners use renewables as part of their energy mix, and 39% of mining comes from renewable sources). All things considered, we see bitcoin and the broader blockchain ecosystem both having bright days ahead and here to stay as part of the mainstream conversation.
🔦 Portfolio Spotlight
The world’s first intelligent NFT by Alethea AI sells for $479k in Sotheby’s auction
Crypto wallet app Ledger Live integrates Paraswap, its first DeFi platform
The integration allows Ledger Live users to swap tokens on the ethereum blockchain, via ParaSwap, without leaving their wallets. ParaSwap is a decentralized exchange (DEX) aggregator that supports various DeFi protocols, including Uniswap, Sushiswap, Balancer, and Curve. When asked why Ledger chose ParaSwap over other similar platforms such as 1inch, Ledger's chief experience officer Ian Rogers told The Block that the aggregator offers an "easy to use interface." Both Ledger and ParaSwap are based in Paris, France.
A company building on Rally has raised $2m in funding!
🏦 Enterprises & Institutions
Nasdaq-listed Victory Capital plans entry into crypto
The Texas-based firm will offer private funds for accredited US investors in partnership with Hashdex.
Interactive Brokers plans to offer crypto trading by end of summer
Thomas Peterffy, IB's chairman and CEO, said during an event that "customers are certainly asking for [crypto trading] and we expect to be ready to offer it to them by the end of the summer."
Invesco plans two crypto-focused ETFs
Roughly 85% of the Invesco Galaxy Blockchain Economy ETF and the Invesco Galaxy Crypto Economy ETF will be in crypto-linked equities. Invesco's funds may skirt the SEC's bitcoin ETF blockade by only investing indirectly in cryptocurrencies.
Coinbase to manage crypto investments of 401(k) provider ForUsAll
Clients of 401(k) provider ForUsAll will be able to invest part of their retirement plans in cryptocurrency as a result of a new partnership with Coinbase.
State Street Bank launches cryptocurrency division
State Street says it plans to evolve into a “multi-asset platform” to support cryptocurrency trading and more.
Sotheby's auction sets new world record for $11.8m CryptoPunk sale
This sale represents a new world record for a single CryptoPunk artwork.
Jack Dorsey suggests Twitter likely to integrate Lightning Network
The Lightning Network is a layer atop the bitcoin blockchain designed to enable faster and cheaper transactions by enabling user-generated channels for sending and receiving payments.
Goldman expands in crypto trading with plans for ether options
Goldman Sachs moved to restart its crypto services this year amid growing interest among institutional investors and its own client base.
MicroStrategy completes $500m offering, plans to buy more bitcoin
The offering was of secured notes due 2028 that bear interest at an annual rate of 6.125%.
MicroStrategy unveils $1bn stock offering, says proceeds could be used to buy bitcoin
Hours after disclosing that it completed a $500m debt offering to fuel additional bitcoin purchases, the publicly traded MicroStrategy signaled in an SEC filing that it may sell as much as $1bn worth of its stock over time.
NYDIG, FS Investments file for new Morgan Stanley-focused bitcoin fund
In March, Morgan Stanley became the first big American bank to offer its clients exposure to bitcoin through a trio of funds, one of which was jointly created by NYDIG and FS Investments. A new filing from the SEC indicates that a fourth fund will be made available.
⚖️ Government & Regulation
El Salvador becomes the first country ever to make bitcoin legal tender
El Salvador’s legislature has passed a bill that will make bitcoin legal tender in the country. This marks the first time a country will recognize the cryptocurrency as a satisfactory form of payment for any sort of monetary debt.
SEC’s Peirce warns against stifling crypto innovation
Hester Peirce, one of five commissioners on the US Securities and Exchange Commission, has been a longtime advocate of a calibrated approach in regulating crypto.
Volcano-powered bitcoin mining goes from Twitter idea to state policy in El Salvador
President Nayib Bukele is moving on multiple fronts to make El Salvador an unlikely bitcoin mecca.
Basel Committee proposes banks to set aside capital to cover bitcoin exposure
The Bank for International Settlements' Basel Committee suggested splitting crypto assets into two groups: those eligible for treatment under existing frameworks and those that are not.
Bank of France, Swiss National Bank begin cross-border CBDC experiment
The banks will experiment with cross-border settlements of two wholesale CBDCs and a French digital financial instrument on a distributed ledger technology platform.
India to reportedly ditch bitcoin ban agenda in favor of asset classification
Indian state officials are reportedly no longer keen on banning bitcoin and a crypto regulatory bill may be up for discussion during the Monsoon Session of Parliament.
Texas greenlights state-chartered banks to custody crypto
The Texas Department of Banking gave state-chartered banks the go-ahead to custody crypto assets. The notice is a simple affirmation that standard risk-based assessments by the banks themselves are adequate to provide cryptocurrency custody.
South Africa’s financial watchdog to bring crypto exchanges into regulatory oversight
The Financial Sector Conduct Authority said it will start to regulate the crypto industry "in a phased and structured approach."
💰 Funding & Exits
Luxor bitcoin mining firm raises $5m Series A led by NYDIG
Luxor had previously raised a $725k pre-seed round from mining firm Argo Blockchain, crypto lender Celsius Network, derivatives exchange Bitnomial, and others.
Pantera Capital and Arrington XRP Capital lead $5.8m Unbound Finance raise
Unbound Capital aims to become the first decentralized cross-chain stablecoin. The private investment round had participation from at least 14 venture funds and over a dozen angel investors from across the blockchain industry.
Sustainable supply chain traceability company Circulor raises $14m in Series A round
This funding round is intended to expand Circulor’s presence in North America and Asia and was led by The Westly Group, a California-based venture firm focusing on sustainability-minded startups.
Stake Technologies secures $10m to build DApp ecosystem for Polkadot and Kusama
The parent company of Plasm Network and Shiden Network has prioritized development initiatives centered around Polkadot and Kusama. The company received support from over a dozen venture firms and several other angel investors.
DeFi startup InstaDApp raises $10m in new funding
The $10m round, which involved the sale of tokens, was led by Standard Crypto. The pool of investors included the DeFi Alliance, Longhash Ventures, along with developer and Yearn founder Andre Cronje.
Hummingbot closes $8m Series A round led by Initialized Capital
Music-focused NFT marketplace raises $4m From Cuban, Kutcher, Dapper CEO
While NFT Genius is largely focused on music, it also expects to bring NFTs into sports, gaming and even comedy
Galaxy Digital and NfX lead $9m raise into Ramp
Founded in 2017, Ramp styles itself as a “PayPal for crypto” service. It aims to make the process of interacting with crypto-assets — whether that's bitcoin or Non-Fungible Tokens (NFTs) — simpler for newcomers to the space.
Lending startup Parallel Finance raises $2m to bring more DeFi to Polkadot, Kusama
Backed by Pantera Capital, Polychain Capital, Lightspeed Venture Partners, Breyer Capital, 8 Decimal Capital and Hypersphere Ventures.
Asia-based Rangers Protocol valued at $63m following private equity round
Rocket Protocol has been rebranded to Rangers Protocol after completing a major investment round. Pantera, Huobi Ventures Blockchain Fund and Alameda Research are among the backers.
Umee raises $6.3m to connect cosmos and ethereum With cross-chain DeFi
The project, led by Tendermint’s former strategy lead, secured backing from Polychain Capital, Coinbase Ventures and others.
Alan Howard leads $25m investment in London crypto custodian Copper
The additional funding will aid Copper in its efforts to help traditional financial institutions adopt crypto and distributed ledger technology (DLT).
The startup behind China's Blockchain Service Network raises $30m
Beijing-based Red Date Technology has closed a Series A round raising $30m led by Kenetic Capital and Prosperity7, the diversified growth fund of Saudi Aramco's venture arm.
Crypto hardware wallet maker Ledger lands $380m Series C
10T Fund invested alongside existing investors and new backers, including Tekne Capital, Uphold Ventures, Felix Capital, Inherent, Financière Agache (Groupe Arnault) and iAngels Technologies valuing the company at more than $1.5bn.
Solana Labs raises $314m in token sale led by A16z, Polychain
Such a massive haul might be necessary if the latest blockchain to be deemed “ethereum killer” for its lower fees and faster processing time is to see that vision through.
DeFi network Karura raises $100m ahead of Kusama’s parachain auction
Karura, a network offering decentralized finance (DeFi) services to users of the Polkadot and Kusama platforms, has raised 200k KSM tokens, equivalent to $100m.
Hut 8 Mining to Raise $82m in Stock Offering Ahead of Nasdaq Listing
The company said it expects “HUT” shares to be trading on the Nasdaq Global Select Market on June 15.
Mythical Games raises $75m to build an NFT game engine
The round was led by WestCap. Existing investors were joined by 01 Advisors and Gary Vaynerchuk’s VaynerFund in the Series B funding. The startup has raised a whopping $120m to date.
Hong Kong-listed BC Group receives $70m in new funding
The investment comes from GIC, formerly the Government of Singapore Investment Corporation, Singapore’s sovereign wealth fund.
Druckenmiller, Loeb back $70m funding for crypto Asset manager Bitwise
The Series B round of funding was led by tech investor Elad Gil and crypto venture fund Electric Capital. Meanwhile, a who’s-who from the financial world also participated, including Daniel Loeb’s Third Point LLC, hedge funder Stanley Druckenmiller, financier Henry Kravis, Bridgewater Associates CEO David McCormick and Nadeem Meghji, a senior managing director at Blackstone.
DeFi exchange dYdX closes $65m raise led by Paradigm
The San Francisco-based protocol development firm, which is focused on decentralized perpetual swaps, announced a $10m Series B fundraise as recently as January of this year. Three Arrows Capital and DeFiance Capital led that round, with Wintermute, Hashed, GSR, SCP, Scalar Capital, Spartan Group, and RockTree Capital all participating.
Fox creates $100m fund for the NFT Market
The entertainment giant behind Fox News and the Fox broadcast network is launching a new fund for digital creators and seeding it with $100m. The fund is part of a broader effort announced in May that includes a new business unit, Blockchain Creative Labs, that will sell and administer NFTs and other digital goods.
Gemini acquires crypto custody startup Shard X for an undisclosed sum
Gemini said Shard X's multi-party computation (MPC) technology would help increase the speed at which it can transfer customer assets and increase usage of assets on its platform.
🚀 Project Launches & Updates
Curve Finance’s new release positions project for AMM takeover
An ETH, WBTC, and USDT trading pool is live on ethereum, and more trading pairs and pools are expected to be added to the platform in the coming weeks.
One River Digital Asset Management sees rise in institutional demand for ‘green bitcoin’
One River Digital's index adds tokenized carbon credits as a premium to the bitcoin purchased.
Dapper Labs unveils Flow-native stablecoin, FUSD, with other ERC-20-like tokens to follow
The maker of NBA Top Shot is deploying new tools for developers to launch tokens on the Flow blockchain.
Bitcoin’s Taproot upgrade gets its 90% mandate
Taproot opens up new possibilities for privacy, multisignature wallets, and security as well as scaling.
🔥 Other Bits We're Excited About
Boson pays a record $704k for Decentraland plot to create a virtual mall
The retail space will allow players of Decentraland’s browser-based game to purchase digital assets they can then exchange for physical goods and services. The purchase price represents the largest ever for a plot in Decentraland’s virtual world. Boson’s mall will allow some of the world’s best-known brands to sell their products in the virtual retail space.
French Football Federation launches official player NFTs with Sorare
Les Bleus players and their sports stats will be tokenized on the blockchain for trading and playing in fantasy games.
Sotheby’s to auction the World Wide Web's original code as an NFT
The sale will go live on June 23, with bids starting at $1k.