What a week

What a week. Immediately after his inauguration, Donald Trump designated America a crypto capital and yesterday issued an Executive Order, announcing amongst other things the appointment of a Crypto Czar, a Working Group on Digital Asset Markets, a prohibition of central bank digital currencies and an evaluation of a digital asset stockpile in the US. He also denounced debanking, pardoned Ross Ulbright (the Silk Road founder), installed an SEC Crypto Task force led by ‘crypto-mom’ Hester Pierce and a Digital Assets Subcommittee led by Senator Cynthis Lummis. And this is just the start.

But without a doubt, the biggest news of the week was the launch of the TRUMP celebrity coin. Investors I talked to this week were nothing short of baffled. What on earth is going on if the president of the United States launches a memecoin (not to mention his wife’s), which at some point reached a ‘fully diluted market cap’ of close to $80bln?

We have two thoughts here. On one hand something like this massively undersells the technology. It distracts and provides serious investors with considerable unease. What also looks shameful is that it enriches insiders at the expense of unsophisticated investors – although I suppose the jury is still out on how exactly it will be treated by the President. On the other hand however, there is a positive story to tell. It shows what this technology is capable of and how far we’ve come with laying the infrastructure as millions people around the world have completely permissionlessly bought into something. It was a serious stress test of the infrastructure and, although there were some hiccups at the peak of activity, the infrastructure held. For investors in the picks and shovels like us, this was an interesting checkpoint. Specifically, it showed that Solana has come very far in supporting large scale throughput and that the Ethereum ecosystem has to step up its game. Healthy competition in other words.

The slightly unseemly parallel I would make is with the early internet. Basically, the internet started with what my grandmother would call blue movies. Not soon after that it conquered the world. Crypto’s equivalent today is unbridled speculation. It is the phase we have to move through to attract eyeballs as well as the real product builders who will take the existing infrastructure and build applications on it that change the world for the better.

The trick to investing in blockchain is to look beyond the headline grabbing news/nonsense and focus on the productive uses of the technology, which we expect will transform industries and unlock endlessly new ways of economic as well as social activity. This is what is going to create great value. Unlike a zero-sum TRUMP coin game.

Relevant financial updates

• Plume Network*, a “real world assets” platform had its token launch this week and currently trades at a $1.34bln FDV, within a year of Portal’s* pre-Seed
• Oshikatsu*, an open anime platform led by top executive at Animax and Sony Pictures raised a $12.5mln Series A co-led by Polychain* and Temasek-anchored Superscrypt (read more )
• Solayer*, a prominent infrastructure toolbox Solana raised a $10.5mln public round at a $350mln valuation (read more )
• Circle acquired Hashnote, a fully regulated institutional-grade gateway and investment platform for decentralized finance (DeFi) (read more )
• Keplr*, by far the largest self-custody wallet in the Cosmos ecosystem raised $5mln at a $50mln valuation led by 1Confirmation (read more )
• Corn*, a DeFi hub for Bitcoin raised a $8.3M in a community funding round following the seed round led by Polychain (read more )
• Jambo*, the leading crypto super app in Africa had a token launch this week. JAMBO currently trades at a $369mln FDV.

*Underlying TBV portfolio position | Prices as per 24/01

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