In a groundbreaking move, the London Stock Exchange (LSE) has announced its decision to accept applications for the admission of exchange-traded notes (ETNs) backed by Bitcoin and Ether. This move opens up a new avenue for professional investors, providing them with an opportunity to delve into the rapidly evolving world of cryptocurrency.
The LSE, in a statement released on Monday, revealed its plan to commence accepting applications in the second quarter of 2024. The exact launch date is yet to be confirmed but is eagerly anticipated within the crypto community. The criteria for the proposed notes are stringent, with the exchange emphasising the importance of non-leverage and the necessity for the underlying crypto assets to be at least 90% held in an offline depositary wallet or equivalent cold storage arrangements.
In a relative note, not too long ago, we had written this piece to help individual investors understand Institutional crypto investment funds. I could serve as a gateway to the digital asset investment portfolio. Moreover, the first crypto unicorn of 2024, HashKey has also just grabbed a $100M funding.
Furthermore, the custodians responsible for holding these assets must adhere to anti-money laundering regulations in key jurisdictions, including the UK, European Union, Jersey, Switzerland, or the United States. This move by the LSE comes at a time when Bitcoin has surged past $71,000, marking a nearly 70% increase in its value this year, fueled by substantial inflows into US exchange-traded funds.
Understanding crypto VCs and their role
Crypto venture capital (VC) firms play a pivotal role in the development of new cryptocurrency and blockchain startups. These firms, comprised of several investors, provide funding to help startups bring their ideas to fruition. Key criteria for selection include the startup team’s talent and experience in crypto, the potential popularity of their products, and the prospective financial returns for the VC firm.
Crypto VCs to watch out for in 2024
As burgeoning crypto startups set their sights on expansion, securing investment from reputable venture capital (VC) firms becomes a pivotal step in their growth trajectory. Here are the top 5 VC firms, each offering a unique blend of expertise, capital, and strategic support. While the VCs listed here are mostly US-based, but they have a track record of making investments in Europe, including the UK.
Coinbase Ventures
Located in San Francisco, California, Coinbase Ventures emerges as a heavyweight in the crypto VC realm. Boasting a diverse portfolio of 300+ projects, the firm’s strategic focus spans decentralised finance (DeFi), non-fungible tokens (NFTs), and the ever-evolving Web3 landscape. Beyond financial backing, Coinbase Ventures stands as a comprehensive hub for innovative ventures seeking to thrive in the crypto ecosystem. Arweave, a UK-headquartered company, is currently incorporated in Coinbase’s portfolio.
a16z
Situated at 180 Townsend Street, San Francisco, CA, a16z is a seasoned early supporter of crypto startups. With assets under management (AUM) surpassing $35 billion, the firm places a strong emphasis on the vast potential within Web3. Its portfolio includes prominent names in the decentralised finance (DeFi) and NFT sectors, making it a key player in shaping the future of the crypto industry. The VC have already made investments in UK-based companies such as Arweave, Aztec, and Improbable.
Pantera Capital
With locations in San Juan, Menlo Park, New York, and San Francisco, Pantera Capital has been a cornerstone in the crypto investment landscape since its inception in 2013. Managing a substantial $3.3 billion across an extensive portfolio of 210+ crypto projects, the firm showcases a nuanced understanding of the industry’s evolution. Its diverse involvement reflects a commitment to supporting innovation across various crypto domains. The VC has London-based Wintermute’s name under its portfolio.
Paradigm
Hailing from Maryland, United States, Paradigm made a significant impact in 2021 by raising an impressive $2.5 billion for its crypto-focused venture fund. This substantial fundraising has positioned Paradigm as an influential player, with a track record of investments in over 100 emerging crypto startups. The firm’s strategic approach and deep involvement underscore its influence on the current crypto landscape. This VC first took its step in Europe with its investment in Argent back in 2020. The company is headquartered in London
Polychain Capital
Situated in California, United States, Polychain Capital recently made waves by securing a substantial $400 million for its latest crypto fund. Specialising in backing protocols, infrastructure, and early-stage blockchain startups, the firm’s commitment to fostering innovation is evident. This fresh injection of capital solidifies Polychain Capital’s role in supporting projects that contribute to the dynamic evolution of the crypto sphere. The VC had in the past year entered into the European market with Quasar Finance under its portfolio.
These VC firms go beyond providing financial backing; they serve as mentors and connectors within the dynamic crypto landscape. By offering invaluable insights, guidance, and industry connections, these firms play a pivotal role in steering startups toward sustainable growth. As startups weigh their options, the intricate details of each VC firm’s expertise, focus areas, and past successes should inform their decisions, ultimately shaping the trajectory of the crypto ventures of tomorrow.
