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We’re at SF Blockchain Week!

Another week, another conference. It is the SF Blockchain week this time, and there is likely to be more of the same, continuing on from New York and Singapore and Seoul. In case folks are going, here are a few links –

Here, here and here, that track all the events.

Also, please give a shoutout to our own ADITYA MISHRA (drumroll) who will be in SFO this week. Get in touch with him on Twitter or via email. Shoutout to Ken @badwater and Ani @andromeda for sharing these!There have been more crypto conferences this year than there have been days! Clearly conferences are the ultimate picks-and-shovels play. Witness Coindesk’s record profits.

A couple of months ago we had opined in one of our more popular posts around how demand-side indicators for crypto were still lagging, although there were a number of positive supply-side signalsIt now seems like the tide is finally turning. In fact, it seems like institutions have been upping their crypto game for a while now. We wanted to highlight a few key events over the past few weeks day that are highly promising, some of them clear demand side indicator.

  1. TDAmeritrade, the retail brokerage giant, along with CBOE is heavily invested in ErisX, a crypto trading platform targeted at both retail and institutional players. This follows news about Bakkt, the ICE backed crypto exchange that was announced earlier in September. Big deals both, since these are traditional Wall Street institutions (that are not just investment banks) and are more foundational on-ramp infra providers
  2. Circle, the Goldman backed cryptocurrency exchange has been quietly plugging away, ramping up its exchange business, OTC and market making, and even a stablecoin (USDC). Most recently, it launched ‘collections’, a quick way for buyers to buy a basket of ‘thematic’ securities, such as anonymity, platforms, exchanges etc; a form of a rudimentary equal-weighted index, atleast at the point-of-purchase
  3. ^This follows data that showed that institutions have actually been quietly accumulating crypto through the large OTC dealers
  4. Citigroup launching DAR (Digital Asset Receipts) and the New York regulator approving multiple stablecoins, by the Winklevoss brothers and from itBit, an exchange
  5. Abra partnering with Bitwise, an index provider, to launch an index-tracker token through its wallet (Full disclosure: 108 Token is also in discussions with multiple wallet providers and exchanges for such distribution deals). The appetite for plain vanilla gateway products such as crypto indices is clearly increasing. We think a crypto index token has a number of applications in the new crypto-financial system, including portfolio risk management, as collateral for lending, and even as a sort of a stablecoin under circumstances; that is a post in itself, and we will expand upon them later
  6. Coinbase is close to raising a large institutional round, and is valued at almost USD 8 billion. Here is a great teardown on the company.

Just look at those user acquisition statistics for Coinbase –

And the investors in this company (Coinbase) –

Anyway, we have saved the best one for the last. To paraphrase a certain politician-de-jour, this is HUGE! The Yale endowment (~$30 billion), the very same Yale endowment that gave money managers at institutions everywhere the ‘Swensen’ model for asset allocation, has apparently been secretly investing in cryptos. They have invested in A16Z and in Paradigm, another fund co-headed by Fred Ehrsam, the coinbase cofounder. The Swensen model serves as a template for a number of institutional investors around the world, so expect a flood of money to pour in over the next few quarters into crypto.

Taken together, this clearly indicates increasing demand side traction, as well as institutional engagement. This is a classic case of the market overestimating in the short run (as we witnessed in the run up to 20k) and underestimating in the long run. We would imagine that the developments above would warrant a much more serious charge from the bulls, while the inevitable tech mishaps, hacks, iterations and the regulatory progression that are an essential part of the evolution of the industry giving the bears enough fuel to fight back as well.

Meanwhile in Crypto Wonderland….

“Ibinex Prints New Insightful Report” Cryptocurrency exchange software provider Ibinex issued a report called the Global Cryptocurrency Market Report. Apart from conducting a deep dive into crypto markets across the globe, the report highlights trends such as the young age of cryptocurrency investors, Japan’s leading role in crypto trading volumes and the gradual reduction in regulatory uncertainty across the globe.

“TD Ameritrade <> ErisX” Institutional investors continue to provide momentum to investments in cryptocurrency projects. Most recently, U.S. brokerage giant TD Ameritrade announced its investment in bitcoin spot and futures trading exchange ErisX. The deal is a strategic partnership for TD Ameritrade which was the first financial services firm to offer clients access to bitcoin futures contracts.

“Cryptocurrencies are Commodities Part II” In what could be a landmark verdict, the Massachusetts District Court reinforced the SEC’s claim earlier this year that all cryptocurrencies could be treated as commodities. The judgement pertaining to a case against My Big Coin opens the doors for the Commodity Futures Trading Commission to apply commodities’ regulations to the broader crypto space.

“Petro Launch” Nicolas Maduro, the President of Venezuela, has announced that the Petro, the country’s controversial cryptocurrency will begin trading on November 5. The government has faced backlash for eyeing the booming crypto market to raise financing at a time when the country is in a hyperinflation crisis brought upon by the government’s own negligence.

108 Token NAV Update

Today’s NAV is ~$1.26, up roughly 28% since launch.

You can express your interest in 108 Token Series II here. This will be an open-ended, rolling vehicle.Also reach out to us if you are a market maker or a liquidity maker that is interested in a conversation around the 108 Token.

Crypto Twitter Pick

What We Are Reading / Listening To

Unpacking MKR + a16z by Yannick Roux

Bitmain’s IPO Application + Bitcoin Bug featuring Eric Meltzer

Overnight Performance of Top 10 Cryptocurrencies

In addition to this daily newsletter, you can find more stuff to read at our news and research portal, our crypto index token and our upcoming relayer.

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Satoshi&Co Daily Crypto Newsletter

By Ramani Ramachandran and Rohit Alluri

ZPX - Daily Crypto Update