Venture capital investments in cryptocurrency startups up 316% in 2018

Venture capital investments in cryptocurrency startups up 316% in 2018

From Cryptomorrow.com by David Kariuki Nov 23, 2018

A recent report by Outlier Ventures reveals that venture capital investments in the cryptocurrency industry attained a year-over-year growth of 316% to $2.85 billion from $900 million through the three quarters of 2018.

This indicates that more startups in the blockchain and cryptocurrency are turning to more traditional forms of funding even as the number of initial coin offerings or ICOs continued to decrease and raise lesser total amount of capital especially in the third quarter of this year. Of course, the report agrees with previous reports that many startups are now using a mix model of raising capital including ICOs and venture funding.

Outlier Ventures, for instance, says that in the 119 venture capital deals completed in Q3 of this year, venture capital share was the highest in total compared to the total in other quarters this year. VCs within the United States continue to drive these venture capital investments in blockchain and cryptocurrencies. The report states that with capital investments shifting away from tech-savvy retail investors toward VCs, hedge funds and ultimately larger institutional investors, "a large growth" in (startups) new businesses and services that are enabling institutional investors to enter the industry. Those new businesses and services are coming in the form of institutional-grade trading platforms, custody providers, etc that want to solve the technical complexity and risks of dealing with blockchain and crypto such as risk of users losing private keys.

A previous report last month from market research group Diar also indicated venture capital raised by blockchain and cryptocurrency startups had increased three-fold to $3.8 billion in 2018 compared to last year's total. This amount was raised from 2,000 investors (most from U.S. based dealmakers) across 384 deals. The report by Outlier Ventures says some startups in cryptocurrency and blockchain that do not require networks (online communities) to survive, have been avoiding token generation events called ICOs because of increasing legal expenses, marketing costs and community building efforts required. Of course, a lot of decrease in popularity of ICOs has come as a result of bear cryptocurrency market as being witnessed currently. ICOs, according to the new report, raised $1 billion down from $3.8 billion in Q1 representing a 74% decline since the start of the year.

That does not mean the token is unpopular: the report says that startups still believe that the tokens are foundational to Web 3.0 infrastructure and represent the opportunity for new business models. The role of the token is also evolving beyond fund raising into a model for business innovation and could expand as a way to engage, retain and attract users. The latter is being witnessed with chat apps like Kik, Telegram and Line implementing tokens.

Additionally, according to the report, FinTech innovation around crypto and blockchain is still alive and hot. For instance, there was introduction of a blockchain phone in the third quarter from HTC. Evolution of blockchain-based mobile devices and smartphones is expected to help reduce the "leak of personal data from phones and combine secure enclave security with blockchain-based verification and authentication systems." It says that future iterations of retail mobile devices will integrate blockchains as a method to " authenticate third parties accessing private data of individuals." Currently, the new hotness is zero knowledge according to the new report, with enterprises becoming further interested in zero knowledge proofs (ZKP) that for instance enable private transactions, authentication of entries on the ledger, and the verification of claims "without necessarily requiring access to the data itself."

Banking and financial institutions continue to lead in blockchain innovations as their fin-tech programs capitalize on blockchain-based open source projects according to the report.

The author is of the opinion that reduction in volatility could have resulted from "accumulation of tokens by larger more established players and retail investors (who are) no longer panic selling." The author notes that the current bear market, which has seen the market collapse from a high of $829bn in early January to currently around $200bn, is "very unattractive" for active cryptocurrency traders.
According to the report, a lack of volatility for tokens has resulted to a drop in daily volumes from over $20 billion to slightly over $10 billion this quarter.

It says that a rise in alternative investment instruments in the market such as DARs from Citi Bank could further reduce the volume of Bitcoin futures contracts, which has already fallen this year and whose launch (CBOE's) "has not necessarily done much to positively impact the price of the token." Bitcoin futures are struggling partly because of the "heavy expenses involved in taking and maintaining positions."

The new report by Outlier Ventures does reiterate the role of and development of regulation around blockchain and crypto topics: more countries continue to make decisive regulatory determinations relating to the issue, and "forward-looking" countries have started to engage with "regional banking entities" to create a regulatory environment that captures the "vast economic gains." France, Thailand, Singapore, Switzerland and Thailand have pushed for the creation of ecosystems that enable token issuance this past quarter. Japan’s Financial Services Agency also enabled self-regulation of the industry through the ‘Virtual Currency Exchange Association. The UK, France and Switzerland are also exploring possibilities of enabling the token economy.

Source: http://www.cryptomorrow.com/

Venture Capital Marketplace to Asia with VNX Exchange

VNX Exchange is bringing its tokenized venture capital marketplace to Asia with new Senior Vice President Zing Yang.

From Coinannouncer.com By Eseandre Mordi Nov. 22, 2018

The VNX™ exchange – with operational headquarters in Luxembourg, has begun implementation of its marketplace expansion plans. Such moves by the company are aimed at aptly covering newer territories outside the European axis so that more people can have access to some form of simplified token asset trading opportunities. Hence, the exchange’s action is substantially not unconnected with the perceived need for a viable framework that would facilitate the accomplishment of the company’s innovative business objectives for the cryptocurrency setting.

Consequently, VNX has finished its organizational internal formalities for the appointment of its new senior vice president- who would oversee company affairs in the Asian region. The senior executive ZingYang would be directly concerned with the company’s new business interactions in the Asian continent, and she is expected to execute tokenized digital currency venture asset projects that would paint the VNX’s company name and objectives in a positive limelight.

Functions and objectives of the VNX digital currency marketplace

According to operational objective and roadmap tendencies, the VNX exchange is designed to support an active community of digital asset buyers and sellers, on its tokenized asset venture capital supporting platform. The company’s objectives are directed at creating an impressive liquidity structure for the venture capital front, as well as providing an effective and proven means of fund sourcing for ingenious and prospective businesses- powered on a decentralized protocol, amongst others.

With the VNX exchange services, users can successfully explore the merits of prompt digital asset trading and investments, while leveraging on the value-added services as provided by the platform development and management team. Analysts say that the VNX operation methods are very much relevant in terms of simplifying the many risks and complexities of digital asset venture capital investments. By this, the platform creates an opportunity for both the experienced stakeholders and the newbie investors, to profitably engage in the platform’s hosted services.

Note that the platform assists users in a reasonable way, by enabling risk diversifications from the initial stages of user investment. This part of the framework is important because it shares off too much concentrated risks that could results in substantial losses for the investing user.

In order to ensure the effectiveness of its efforts, the VNX digital venture capital marketplace has also entered into top-notch partnerships with cryptocurrency key players- who would help in creating a synergy that brings good results for all the collaborating firms. One of such partnerships is the VNX and NEM blockchain partnership, which was also recently agreed upon. The collaboration has been able to incorporate an ability to produce different protocols and their corresponding security tokens, which would assist businesses and organizations that are hosted on the NEM network. This achievement fulfills one of the exchange’s foremost objective, which aims at facilitating the creation and provision of tokenized assets.

The VNX founder and boss, Alexander Tkachenko, has expressed the company’s readiness to follow through with seeing to it that digital venture capital investments are given a rightful place priority in the next few years.

Zing Yang’s responsibilities as the new Asian VNX service head

The new vice chief for the Asian market is charged with a number of responsibilities that are considered pivotal to the exchange’s success tendencies (or failures) in the new frontier. Zing Yang’s primary assignments are quite specific, and this would most likely take the bulk of her concentration for the earliest periods of her tenure.

Since the VNX company operations are still very much new in the region, she is expected to basically create some high-level user to company trust, which would allow for greater public participation in the solutions that the platform has to offer.

As part of the schedule for bringing this to light, she would be working to extend VNX company operations to countries such as Singapore, South Korea, and Hong Kong. These are places with significant cryptocurrency usage and investments; however the scope is not intended to limit on these countries alone, in the long run.

Asides this, Yang is charged with a responsibility of creating and enforcing a local footprint for the company, as well as building up a strong ecosystem- that stands the test of time, in the Asian axis. If the company’s intentions for its newfound operation location comes to fulfillment, then the company should have established a major stronghold in the coming days.

The new executive’s appointment comes as a well made choice, considering the fact that Yang has worked extensively in investment management fields, as well as other job descriptions involving public and private equity. She is an expert in digital currency and venture capital investments among others, with several years of active participation plus reasonable contributions made. She is currently a director at the Litecoin foundation, having served in other positions in various firms such as the capital group.

For more information, visit: https://vnx.io/

Source: https://www.coinannouncer.com/vnx-exchange-appoints-zing-yang-to-act-as-its-senior-vice-president-in-the-asian-region/

IPOS Are Having a Record-Breaking Year

A RECORD-BREAKING YEAR FOR IPOS

AngelList Weekly, November 15, 2018

2019 is shaping up to be a breakout year for tech IPOs.

The economy is strong, unemployment rates are low, and investor optimism is high with rising tech valuations. Airbnb, Slack, and Lyft could all go public within the next year, and despite its slowing growth, Uber is among the most anticipated offerings in years.

The ride-sharing company's latest valuation sits just over $70 billion, but recent estimates could have it pegged at upwards of $100 billion. Even though Uber announced $1.07 billion in third-quarter losses Wednesday, it still has the potential to be the biggest IPO in history. Alibaba currently holds that title for its $25 billion offering in 2014, but at a rumored valuation of $120 billion, Uber would only need to offer a fraction of its shares to take the crown.

For comparison, Uber’s possible $120 billion valuation would be roughly four times Airbnb’s current $31 billion, eight times Lyft’s $15 billion, and over 17 times Slack’s $7 billion.

The numbers are staggering in their own right, but their potential is even more impressive when you consider activity from earlier this year. In the first quarter of 2018, "the median IPO size for U.S., VC-backed companies was $110 million," according to a Pitchbook analysis.

By the end of September, 173 U.S. IPOs had raised just over $45 billion, according to data from PwC. That's almost a 50% increase compared to the same period in 2017. And while 2018 has seen the strongest IPO activity since 2014, if the tech giants currently expected to go public in 2019 follow through, we’ll have a front-row seat to record-breaking activity.

As Bloomberg aptly described it: "The last time three 11-figure U.S. tech companies went public in the same year, Bill Clinton was president and Apple Inc. was worth less than 1% of Microsoft Corp. That was 2000, when, with air leaking out of the dot-com bubble, the company that made the Palm Pilot was valued at $21 billion."

Source:  https://angel.co/newsletters/a-record-breaking-year-for-ipos-111518

Crypto Startups Welcomed by Boost VC

Boost VC Issues Call for Crypto Startups

From CCN.com Oct 29, 2018

Technology startup accelerator Boost VC has announced that it is accepting applications from crypto startups to join Tribe 12, its latest accelerator program cohort. Since 2012, Boost VC has graduated several cohorts with more than 75 crypto-related projects including prominent blockchain projects like Etherscan, Aragon, and MyCrypto.

According to the announcement, which appeared in a Medium post, the company is seeking to invest in blockchain startups that provide solutions for cross chain functionality, front end blockchain solutions, crypto team building and maintenance, and general blockchain scaling.

‘Missing Puzzle Pieces’
Boost VC describes its investment focus for Tribe 12 as an attempt to fill in missing pieces in the blockchain and crypto adoption puzzle from an infrastructure point of view. While investors like Goldman Sachs continue to grab headlines with eye-catching investments in startups focused on crypto custody and trading solutions, Boost VC is taking its investment from a wider perspective, seeking out startups that can build nuts-and-bolts blockchain solutions such as cross-chain navigation interfaces and management solutions for the peculiar challenge of distributed crypto teams.

Applications are welcomed from startups interested in creating decentralised frameworks for commerce, communication and government similar to ConsenSys, but operating on other non-Ethereum blockchains. According to Boost VC, the goal is to explore studio builder models for quick iterations on bringing crypto mainstream. Boost VC is also looking for projects focused on the creation and management of crypto teams, which come with the unique and unprecedented challenge of being almost entirely remote, contractor-heavy instead of employee-based, and having the near-instant liquidity offered by crypto payments, which creates a different incentive model from traditional startups.

In addition, projects that create cross-chain interfaces outside of custody, exchange and wallet solutions are particularly prized for investment. This is because Boost VC sees such projects as essentially land grabs offering the opportunity to build a blockchain interaction utility that can be recreated across the other top 5 – 10 blockchain networks.

The company also says it is looking for the “Coinbase for other blockchains/dapps” as well as a possible solution for legal gambling that takes advantage of differing regulatory environments across jurisdictions. Country-specific custody solutions and security trading solutions are also mentioned.

An excerpt from the announcement reads:

“Regulatory arbitrage plays. We invest globally. Therefore we will look at teams using certain jurisdictions to their advantage. Areas of legal gambling. Custody designed for specific countries. Trading securities.”

Projects working on such solutions are encouraged to apply to Boost VC’s Tribe 12 accelerator batch.
Source: https://www.ccn.com/boost-vc-issues-call-for-crypto-startups/