White Star Capital Digital Asset Fund - newsletter #41
Regardless of crypto price action, the blockchain community is proving their dedication to growing the ecosystem!
Billions in crypto dry powder, our thoughts on the DAO economy, and product discovery in the Metaverse!
This week, we put out a special report on a digital asset sub-sector which we believe will be a major opportunity going forward – decentralized autonomous organizations (DAOs). We recommend giving it a read and reaching out with any questions!
While crypto prices continued their volatile price action, we have seen a steady and impressive flow of major funding rounds being announced, project updates, and launches. It is clear to us that regardless of crypto price action, the blockchain community is proving its dedication to growing the ecosystem. From positive regulatory progress to multi-billion dollar dedicated crypto funds, the ecosystem doesn’t show signs of slowing down!
A topic we see taking over the Web3 conversations is the Metaverse. Metaverses are virtual worlds with digital land and in-game items. As they exist today, metaverses are digital outskirts – they’re sparsely populated, unsettled lands teeming with untapped potential. The earliest settlers of the outskirts are often the speculators, though we are starting to see real end-user activity blossoming.
At the end of 2020, all-time Metaverse sales exceeded $55m ($20m which came in 2020 alone). Within the first quarter of 2021, Metaverse sales have already surpassed $30m. While these figures may seem meager compared to recent NFT sales, it’s worth mentioning the growth and excitement about the Metaverses themselves.
While the idea of Metaverses has been around for some time now, we are just starting to see the potential use cases come to life.
Metaverses are starting to blur the lines between tangible and intangible – concerts, galleries, casinos, and more are all accessible in the Metaverse.
More recently, real estate owner and digital real estate firm Republic Realm are turning an estate it recently acquired for close to $1m into a virtual shopping district. The Metajuku shopping district is modeled after the Japanese district Harajuku, which is known for its street fashion. It will house two brands that sell digital clothing items.
What this means is that we’re going to see Gucci stores in the Metaverse selling NFTs and digital goods that can be used and worn in the Metaverse much like a pair of shoes purchased from your local Gucci store.
This may seem unusual now but the willingness to pay for digital goods is already proven, even in web2 environments which can’t enforce digital ownership or scarcity:
Much of what we’ve read and seen is not new, but has been happening for months with each instance providing further Metaverse adoption. The Metaverse is here and we recommend you check it out!
Crypto Metaverses live today: Decentraland | Sandbox | Cryptovoxels | Somnium
🔦 White Star & Portfolio Spotlight
Hugh Hendry & Rally CEO Kevin Chou discuss the token revolution
mStable has integrated with ParaSwap!
ParaSwap is the 5th most active Dapp on Polygon by active users!
🏦 Enterprises & Institutions
Latest NYDIG partnership could bring bitcoin to your local credit union
Up to 18.3m Q2 customers will soon be able to buy, sell and hold bitcoin directly from their bank accounts.
Singapore’s DBS Bank enlists Nivaura’s ‘one-click’ blockchain security issuance
Nivaura is also launching the open-source GLML Foundation to help create automated tokenized securities.
Ark Invest files to create bitcoin ETF
With the filing for the ARK 21Shares Bitcoin ETF, Ark joins the swelling ranks of companies hoping this will be the year the SEC approves a bitcoin ETF.
Morgan Stanley fund holds more than 28,000 shares of GBTC
The fund, which seeks exposure to many European companies as well as other assets, owns 28,289 shares of GBTC — equal to about $1.3m.
ARK Investments partners with 21Shares to market a newly proposed bitcoin ETF
The aim is to offer direct exposure to bitcoin through shares valued daily based on the S&P Bitcoin Index, the tool developed by S&P Dow Jones Indices.
World's biggest interdealer broker TP ICAP to launch crypto trading platform with Fidelity and others
The platform is being developed with crypto custody providers Fidelity Digital Assets and Standard Chartered's Zodia Custody, alongside liquidity provider Flow Traders. The idea is to provide clients a separate but interoperable model for execution and settlement.
⚖️ Government & Regulation
SEC delays decision on Valkyrie bitcoin ETF
The SEC designated Aug. 10 as the revised date when it will approve or disapprove Valkyrie's application.
Two blockchain bills pass in the US House, head for Senate
The Consumer Safety Technology Act passed in the House of Representatives. Two of its three titles were blockchain and crypto-focused bills from Representative Darren Soto (D-Fl), while the third focuses on regulating AI.
Colombia’s capital unveils $750k blockchain investment plan
Companies can apply to the Bogota Innovation, Technology and Creative Industries Fund for investment.
El Salvador is handing out up to $117m in bitcoin to its citizens
El Salvador will be giving out $30 in bitcoin to any of its adult citizens that download a specific app and become verified on it.
💰 Funding & Exits
Huobi investment arm backs Beyond Finance with strategic investment
As part of the investment, Huobi will advise Beyond Finance on creating a decentralized "synthetic-asset" platform. The size of the investment wasn't disclosed.
Crypto data firm Kaiko closes $24m funding found, looks to Asia
The round was led by Anthemis and Underscore VC with participation form German venture capital firm Point Nine and French VC firm Alven.
NFT site Rarible to launch marketplace on Flow blockchain following $14.2m funding round
Venture capital firm Venrock and blockchain venture firm CoinFund led the $14.2m Series A round of funding. Venture firm 01 Advisors also participated in the funding round.
Nayms secures an additional $6m for future NAYM token
Investors include XBTO, Maven11, Coinbase Ventures, Spartan Ventures, DFG, LD Capital, Cadenza, Woodstock and others.
Yield team raises $10m to build out DeFi bond market
The project, which was incubated by Paradigm, introduced fixed-rate lending to Ethereum, allowing market participants to borrow at fixed rates as well as issue tokenized bonds that resemble Wall Street's zero-coupon bonds.
DeFi insurance upstart Risk Harbor goes live with $3.25m in seed funding
The seed round was co-led by Framework Ventures and Pantera Capital and also included Bain Capital Ventures, Coinbase Ventures, Nima Capital and Digital Currency Group.
RabbitHole raises $3.6m to build the on-chain resume for the future of work
The round was led by Electric Capital. RabbitHole helps individuals go down the “crypto rabbit hole” by rewarding them for using crypto applications on smart contract blockchains like Ethereum and Polygon.
Argo Blockchain receives $20m bitcoin-backed loan from Galaxy Digital
The proceeds of the loans, along with cash raised from previous funding rounds, would be used to expand its mining operations in Texas.
Blockchain data tracer Nansen raises $12m in Series A led by a16z
Other investors in the round included Skyfall Ventures, Coinbase Ventures, imToken Ventures, Mechanism Capital, and QCP Capital.
Worldcoin raises $25m to develop an orb-shaped device that can read a person’s iris
The company is backed by Andreessen Horowitz, the venture capital arm of Coinbase Global Inc., LinkedIn founder Reid Hoffman and Day One Ventures.
Novogratz-backed Cryptology Asset Group invests $49m more in Block.one
Publicly traded Cryptology (in Germany) was already one of Block.one's largest institutional backers, and now owns about 4.9% of the firm
Crypto sleuthing firm Chainalysis raises $100m, this time at $4.2bn valuation
The Series E round of funding was led by Coatue Management. Chainalysis also raised $100m in a Series D funding round that was announced in March.
'Largest crypto fund ever:' a16z officially launches new $2.2bn crypto venture fund
The new "Crypto Fund III" will be co-led by Chris Dixon and Katie Haun.
Morgan Creek Digital announced its third venture capital fund, Morgan Creek Digital Fund III
The firm announced the $80m first close its third venture fund focused on blockchain technology and digital assets, which has a $400m target size.
CoinFund set to launch new investment vehicle for NFTs
Dubbed Metaversal, the new vehicle will serve as both a way for investors to bet on the overall market and as a development studio for NFT companies.
Bitcoin miner TeraWulf to merge With Nasdaq-listed Ikonics
The new firm will bear TeraWulf's name and is expected to trade on Nasadaq under the ticker "WULF."
Deutsche Börse moves into crypto custody with $108.6m buy of Crypto Finance AG stake
Deutsche Börse Group said it has agreed to buy a two-thirds stake in Crypto Finance AG for more than $108.6m, moving the Germany-based exchange deeper into the cryptocurrency asset class by allowing it to now offer custody and other crypto-related services to institutional and professional clients.
🚀 Project Launches & Updates
Wirex eyes mainstream DeFi with Fireblocks integration
Wirex is launching X-Accounts, a new service that offers users the chance to earn up to 10% interest on crypto holdings and 16% on fiat funds, in a partnership with custody and infrastructure firm Fireblocks.
Coinbase unveils ‘Solidify’ tool to auto-audit smart contracts and DeFi clones
Designed to be used by smart contract auditors, asset issuers and other exchanges, the firm has plans to make the tool open source later this year.
Opera browser adds first stablecoins to native wallet – cUSD, cEUR
Opera said the Celo tie-up is part of an overall strategy to eliminate hurdles to using blockchain tech.
Compound Labs launches ‘Treasury’ to get big firms reaping DeFi yields
It could be one of the most significant developments in “institutional DeFi” to date. While asset managers like Bitwise have packaged DeFi tokens for big investors, few have offered gateways to DeFi’s underlying protocols.
🔥 Other Bits We're Excited About
Gemini pledges to offset 350,000 tons of bitcoin-related carbon emissions
Gemini will be "making contributions" to purchase the 350,000 in offsets through the University of Chicago-based non-profit Climate Vault. In the future, Gemini will calculate what portion of the Bitcoin network it owns, the energy and carbon emissions associated with that, and then offset it through its partnership with Climate Vault.
Jay-Z puts a CryptoPunk NFT as his Twitter profile picture
The musician is also selling an NFT of his debut album at auction house Sotheby’s.