Crypto prices continued their downward slide this week but there was no slowdown in activity. I purposefully did not include Microsoft’s acquisition of Activision Blizzard – for $70B! – because none of the gamers on either platform will receive a penny. It’s big news but we take a ‘principles first’ approach here.
Earnings week for banks! This newsletter will focus on the crypto efforts of Signature and Silvergate, both of which are FDIC banks that accept deposits from crypto clients and have internal payments platforms for digital assets.
Signature: Q4 growth was driven by the digital asset banking team, which grew deposits by $5.7B and now has over $21B in deposits … Saw continued adoption of their blockchain-enabled digital payments platform (Signet), which grew by $2.4B to $7.7B in Q4 … The bank now has 1,000+ digital asset clients (+139 in Q4).
Silvergate: Reported record demand on the Silvergate Exchange Network ('SEN', a real-time, 24/7, API-enabled proprietary payments network), which saw transfer volume increase 35% sequentially in Q4 and 270% annually … Added 400 digital currency customers in 2021, bringing the bank’s total to 1,381 (+42% y/y growth) … Now have $570M in SEN leverage commitments (bitcoin-collateralized lending product), with zero losses to date and no forced liquidations … Currently laying the infrastructure groundwork for a stablecoin offering … Announced the launch of the EJF Silvergate Ventures Fund, a joint investment vehicle focused on early-stage fintech/digital asset startups.
While all other crypto-assets and NFTs are fighting for our fleeting attention spans, Bitcoin continues to operate on a higher plane, mingling with national and local governments. The Mayor of Rio de Janeiro committed to putting 1% of the city’s balance sheet into bitcoin this week and is considering implementing a tax break for citizens that pay a specific property tax in bitcoin.
Fundraises | Andreessen Horowitz plans to raise $4.5B for two new crypto funds, with $3.5B being directed to its crypto venture fund and another $1B raised for its crypto seed fund … Mechanism Capital announced the launch of a $100M fund focused entirely on gaming investments and direct partnerships with studios to develop new games. The explosion of vertical-specific strategies is coming to crypto … Crypto exchange FTX is bringing on Lightspeed veteran Amy Wu to lead its $2B venture fund to invest in crypto startups across the ecosystem.
Financings | IRA platform iTrustCapital raised a $125M Series A that values the company at over $1.3B. I still remember when a $125M round and $1B+ price tag was considered 'late-stage' … The Near Foundation announced the close of a $150M funding round, with Three Arrows Capital leading the private token sale. The fundraising was completed 'end-to-end' in two weeks which is, admittedly, several months in crypto-years … In between playoff games, Tom Brady found time to close a $170M Series B for his NFT agency company, Autograph, in a deal led by a16z and Kleiner Perkins. Autograph acts as an agency go-between for celebrities to engage in crypto-influencing in a highly curated way (via NFTs). No word on if the company has installed spyware or a deflationary tokenomic model … Animoca Brands, a Hong Kong-based metaverse startup focused on NFTs and gaming, raised a $359M financing that values the business at over $5B.
NFTs | Coinbase is partnering with Mastercard to classify NFTs as 'digital goods' and unlock a new way to pay for NFTs using Mastercard. This follows the recent announcement of Coinbase NFT, a peer-to-peer NFT marketplace. SVB corporate cards are issued by Mastercard, but that does not mean you can expense NFT purchases … Walmart filings reveal the retailer’s plans to meet customers in the metaverse via the creation and sale of its own cryptocurrency and NFTs.
Other | Crypto exchanges are coming after fintechs with planned expansions into stock trading. Stocks coming on-chain is simply the next step in crypto eating fintech … Crypto job posts on LinkedIn grew 395% in 2021 … 81% of crypto-asset buyers identify as male, and BFF wants to help change that. Led by Brit Morin, Jaime Schmidt, and celebrities like Mila Kunis and Gwyneth Paltrow, BFF is building a new open-access community to bring more women and non-binary folks into crypto. 👏
I won’t cover in detail here but there are several links at the bottom for those interested on a summary of Ethereum’s explosive growth in 2021 and a brief guide to OpenSea challengers. These OpenSea challengers have the king of NFTs on notice: new OpenSea CTO Nadav Hollander, who came over in the recent Dharma acquisition, might have hinted at launching a token in a twitter thread this week. 👀
Source Code
Signature Bank (SBNY) Q4 2021 Earnings Call Transcript:
Silvergate Capital Corporation's (SI) CEO Alan Lane on Q4 2021 Results - Earnings Call Transcript:
Rio de Janeiro mayor plans to invest 1% of the city's treasury in crypto:
https: /www.theblockcrypto.com/post/130311/rio-de-janeiro-mayor-bitcoin-btc-1-treasury
Andreessen Horowitz plans to raise $4.5 billion for new crypto funds:
Mechanism Capital Launches $100M Fund Focused on P2E Gaming:
https: /blockworks.co/mechanism-capital-launches-100m-fund-focused-on-p2e-gaming/
Crypto Exchange FTX Sets Up $2 Billion Venture Fund:
https: /www.wsj.com/articles/crypto-exchange-ftx-sets-up-2-billion-venture-fund-11642163402
IRA Platform iTrustCapital Raises $125M to Expand Bitcoin Retirement Options:
https: /decrypt.co/90688/ira-platform-itrustcapital-raises-bitcoin-retirement-options
Near Raises $150M From Major Crypto Investment Firms:
https: /www.coindesk.com/business/2022/01/13/near-raises-150m-from-major-crypto-investment-firms/
Tom Brady’s buzzy celebrity NFT startup Autograph banks $170M from Silicon Valley’s top crypto investors:
Metaverse startup Animoca Brands hits valuation of over $5 billion with new funding:
Coinbase and Mastercard partner to revolutionize NFT purchase experience:
Walmart Filings Reveal Plans to Create Cryptocurrency, NFTs:
Crypto Exchanges Eye Taking on Robinhood With Expansion Into Stock Trading:
Crypto job posts on LinkedIn rocketed 395% in 2021:
https: /cointelegraph.com/news/crypto-job-posts-on-linkedin-rocketed-395-in-2021
BFF is a New Online Community For Crypto Curious Women and Nonbinary Folks—Crypto Bros Need Not Apply:
https: /www.printmag.com/design-news/bff/
State of Ethereum | Q4 Report:
The Year in Ethereum 2021:
https: /stark.mirror.xyz/q3OnsK7mvfGtTQ72nfoxLyEV5lfYOqUfJIoKBx7BG1I
The Defiant’s Go-To Guide to OpenSea Challengers:
https: /thedefiant.io/opensea-challengers-new-marketplaces/
[Disclaimer: Any opinions expressed are solely my own and do not express the views or opinions of my employer. Because the information included in this newsletter is based on my personal opinion and experience, it should not be considered professional financial analysis or advice.]
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