First, a quick market update.
The markets have been a bit shaken by a few small hacks in the past few weeks. But overall, crypto prices have been fairly resilient recently. Weak hands are still being shaken out of the market, but the pace of selling has slowed dramatically, which is inevitable after a run like we had last year.
I continue to see signs of an institutional boom in the works. Coinbase has officially launched its custody service for large investors, and Bloomberg reported earlier this month that 10 clients are already on board. Coinbase’s goal is to have $5 billion under management from 100 clients by the end of the year. If it can pull it off, that’s enough to move markets substantially higher on its own. I suspect it’s a realistic goal.
But Coinbase isn’t alone in launching a custody service for institutional investors. Fidelity, the Nasdaq, and the New York Stock Exchange’s parent company (Intercontinental Exchange) are all reportedly working on crypto asset custody and exchange solutions.
And now, let’s go over some portfolio news…
Draper Esprit Launches on U.S. OTC Market (Yahoo Finance)
Our recent recommendation Draper Esprit (the publicly traded venture capital fund) is now available for purchase on the U.S. over-the-counter (OTC) market. Its ticker symbol is GRWXF. This should make it easier for everyone in the U.S. to buy.
In terms of price action, Draper Esprit (LON: GROW) has been strong since our recommendation, rising from 473 pence to 550 pence today. The addition of a U.S. listing could give it a sustained boost. Clearly, interest in this unique investment is rising.
The firm also announced a partnership with Earlybird, a German venture capital firm, to co-invest in startups. Earlybird has a strong presence in Germany and the Nordic nations, while Draper is stronger in the U.K.
Draper Esprit will also invest 18 million pounds in Earlybird’s latest venture fund, Digital West Early Stage fund VI. You can read more about the partnership from Reuters.
Ledger Announces $29 Million Profit, Attracts More Venture Money (Coin Telegraph)
If you bought Draper Esprit after our recommendation, you also own a piece of Ledger. Draper was the lead investor in the hardware wallet startup’s latest round of funding. And it will (likely) keep investing in subsequent rounds as long as the company continues executing so well.
Ledger sold more than 1 million hardware wallets in 2017. And it just announced a profit of $29 million for the year. This is officially a red-hot startup, and it’s attracting top-tier investors.
“Sources told Forbes that the forthcoming round has already attracted the interest of tech giants like Samsung, Google’s venture arm GV and Siemens, with talk of Ledger’s valuation reaching as high as $1 billion,” Cointelegraph reports (emphasis mine).
Ledger had more good news recently. The company plans to support 100 cryptocurrencies/tokens by 2020, and it’s rapidly expanding its institutional offerings. Here’s some analysis from CoinDesk (once again, emphasis mine):
|
Ledger actually has two business lines targeting institutional investors. One is a series of partnerships with organizations such as Nomura bank in Japan, which uses Ledger’s tools for full-custody services, more akin to a traditional deposit.
The other is called the Vault, an enterprise-grade custody solution for teams at an institution, like traders at a hedge fund, to self-manage crypto assets, an arrangement that’s more in line with the crypto community’s ethos. This multisignature wallet is connected to many individual hardware devices for each team member. |
Ledger is one of the big reasons I like Draper Esprit. But it’s certainly not the only one. When you buy Draper Esprit, you get exposure to dozens of high-quality startups that are among Europe’s fastest-growing companies.
Read the full Draper Esprit recommendation here if you haven’t yet.
Consensys Highlights OmiseGO’s Plasma Scaling Solution (Consensys.net)
Consensys is a widely respected blockchain studio. It recently highlighted OmiseGO’s bold plan to build a decentralized exchange that will scale to institutional levels. Here are three noteworthy excerpts.
- “The decentralized exchange (DEX) being built by OmiseGO will also allow for transactions to occur seamlessly and instantly. By reducing the time, energy and cost of transacting, OmiseGO solves the coordination problem of today’s payment industry.”
- “The OmiseGO team’s goal is ambitious – to build a decentralized, asset-agnostic exchange capable of instantly processing global transactions of any size.”
- “Recognized as global leaders in the realm of financial tech, the team at OmiseGO has an ambitious task ahead, but the benefits for financial participants, the unbanked and the ethereum blockchain are far more than enough for us to celebrate them and cheer them toward their goal.”
Nano Community Gives Venezuelan Family a Boost (Bitcoin Magazine)
Sadly, the situation in Venezuela continues to deteriorate. The local currency, the bolivar, has been crushed even further this year. It’s one of the worst financial situations imaginable – hyperinflation.
Naturally, cryptocurrency is hugely popular in the country. Bitcoin is by far Venezuela’s most liquid and popular crypto. But Nano made some inroads toward adoption this week. A Venezuelan named Hector posted a message on Nano’s Reddit page describing how difficult living with hyperinflation is. Generous Nano community members reacted, donating more than 360 nano ($960) to Hector.
The generosity sparked widespread media coverage. Bitcoin Magazine, Cryptovest, CCN, Inside Bitcoins and many other outlets covered the story.
Here’s an excerpt from Bitcoin Magazine‘s coverage:
| … while bitcoin is the most entrenched cryptocurrency in the country, bitcoin cash and nano are beginning to cultivate a presence of their own, thanks to lower transaction fees. |
Vertcoin Community Holds Strong
Despite recent price action, team Vertcoin is still pushing forward. The Reddit community is still active, helpful and optimistic. The official Twitter account continues to give updates and post positive community news. Developers are hard at work making improvements and new wallets.
James Lovejoy, one of Vertcoin’s core developers (and researcher at MIT’s Digital Currency Initiative) said it best in this Tweet:
| No market movement can stop me from working on what I believe in. I often wish others had the same resolve. |
Clearly, this coin still has true believers and a dedicated community. If institutional buying ramps up this year, and I expect it to, I think vertcoin will be a popular choice.
That’s all for this week. I hope everyone has a great weekend.
Note: I’ve been analyzing beat-down altcoin opportunities and plan to have a new pick for you soon. Crypto is still in a downtrend, and many altcoins are being taken to the woodshed, so I’m being a little cautious here.
Good investing,
Adam