GLOBAL RACE TO BE A DIGITAL ASSET HUB
Blockchain Coinvestors Newsletter
Vol. 5, No. 5, May 2023
GLOBAL RACE TO BE A DIGITAL ASSET HUB
It has been ten years since the Blockchain Coinvestors founding team wrote down their investment thesis.
"Digital monies, commodities, and assets are inevitable and all of the world’s financial infrastructure must be upgraded"
A great deal has changed in the world since then and perhaps the most important change for investors in Blockchain is that almost all of the world's great financial centers now agree with our thesis, and are moving rapidly to introduce pro-innovation regulation in order to position themselves as digital asset hubs.
Every week the newspapers have announcements as national governments and financial center leadership groups state their intent to be a global leader in digital monies, commodities, and assets. These are just a handful of the headlines we've come across in recent months.
Beginning this month, Blockchain Coinvestors will publish an ongoing tracker called Financial Centers - Regulatory Readiness.
The tracker summarizes the regulatory readiness of the world's financial centers. We assess the progress of each and group them into 'Leaders', 'Laggards' and those in the middle which we call 'In Process'.
Almost all of the world's financial centers are actively implementing or preparing to implement important new financial regulation to enable the innovation that our funds focus on.
The tracker records each financial centers' progress towards five important milestones:
Leadership Aspiration: The leadership of the country have declared the intent to be a global hub for digital monies, commodities, and assets
Commitment From Premier: The foremost leader (e.g. President, Prime Minister, Premier) of the country has made a personal commitment to drive this transition
Draft Proposed: The lawmakers of the country have drafted at least one important body of legislation to begin laying the foundation for the upgrading of financial systems in the country - most usually focused on market structure and/or stablecoin regulation (many more elements of additional law will be required, but a foundation must be laid)
Approved: The initial legislation has been approved
Implemented: The initial legislation has been implemented
While decades of additional regulatory work should be expected, including the eventual harmonization across jurisdictional boundaries, these five milestones provide a guide for the readiness of each financial center for a future world of digital monies, commodities, and assets.
We consider a leading financial center to be those which have made substantial progress against these five milestones - The Leaders.
We consider Laggards to be financial centers which have not made initial progress against these five milestones either because of the absence of local or national leadership decision making.
At any time visit www.blockchaincoinvestors.com/regulation to download the most recent tracker as well as these other two other resources:
Blockchain Coinvestors talking points for regulators, and
The latest legal view of the US's informal 'Operation Chokepoint 2.0'
Thank you for reading
The Blockchain Coinvestors Partners
ABOUT BLOCKCHAIN COINVESTORS
Launched in 2014, Blockchain Coinvestors’ vision is that digital monies, commodities and assets are inevitable and all of the world’s financial infrastructure must be upgraded. The mission is to provide broad early stage coverage of the emerging unicorns and fastest growth blockchain companies and projects. Blockchain Coinvestors’ investment strategies are now in their 10th year and have to date invested in 40+ pure play blockchain venture funds in the Americas, Asia and Europe; and in a combined portfolio of 750+ blockchain companies and projects including 70+ blockchain unicorns. Blockchain Coinvestors’ first fund of funds ranks in the top decile amongst all funds in its category on both Pitchbook and Preqin. Headquartered in San Francisco with a presence in London, New York, Grand Cayman, Zug and Zurich, the alternative investment management firm was co-founded by Alison Davis and Matthew Le Merle.
FUND PERFORMANCE
Blockchain Coinvestors’ Fund of Funds strategy provides diversified early stage coverage of the best blockchain opportunities by partnering with leading pure play venture funds in the Americas, Asia, and Europe. Blockchain Coinvestors Funds I and II have already experienced significant appreciation. Fund I Net TVPI is 4.04x with an IRR of 51.4% and is one of the highest performing fund of funds in the world according to Pitchbook and Preqin. Fund II shows impressive early results with Net TVPI of 1.18x and an IRR of 16.3%. Fund III closed at the end of 2022 and will begin reporting this year, while Fund V is preparing for its final closing in the next quarter. The newest fund of funds - Fund VII - is now in formation. Blockchain Coinvestors also manages two direct funds; Fund IV (Early stage token) and Fund VI (Mid stage growth).
BLOCKCHAIN COINVESTORS CURRENT OPPORTUNITIES
Our funds provide investors with global, diversified exposure to early stage investing into the blockchain space. Our Fund of Funds allows an investor to make a single investment to access global, diversified exposure to leading early stage blockchain venture investments on an institutional platform, while our direct funds provide concentrated early stage exposure. We also provide regular coinvestment opportunities to our investors.
Funds are available to accredited investors, with minimums of $250,000 or more at the discretion of our managers.
Blockchain Coinvestors Fund VII (Fund of Funds). The Blockchain Coinvestors Fund of Funds strategy provides diversified early stage coverage of the best blockchain opportunities by partnering with pure play venture funds in the Americas, Asia, and Europe. A single investment accesses global, diversified exposure to leading early stage blockchain venture investments on an institutional platform. The newest fund of funds - Fund VII - is now in formation.
Blockchain Coinvestors Fund IV (Early Stage Token). This direct fund accesses early stage tokenized projects in their formation and seed stages through relationships with other leading blockchain investors. The Fund leverages asymmetrical information from 40+ VC Funds to pick the most attractive opportunities.
Blockchain Coinvestors Fund VI (Mid Stage Growth). This direct fund provides exposure to the emerging category leaders in the blockchain ecosystem. The Fund assesses the 750+ blockchain companies and projects in the portfolio and employs a robust investment framework to select investment opportunities in their mid stage rounds - typically Series A, B, C.
Coinvestments. The Blockchain Coinvestors' coinvestment program offers investors the opportunity to increase their exposure to emerging category leaders in the blockchain space.
Contact our Capital Formation team at IR@blockchaincoinvestors.com to learn more about any of these opportunities
INTERESTED IN MORE? REGISTER NOW FOR UPCOMING WEBINARS AND CALLS
Our investment team hosts regular webinars and calls to help educate our community about our investment thesis focused on the inevitability of digital monies, commodities and assets and the role that blockchain technology plays in enabling them. We discuss what we have learned and how we are using our knowledge to inform our own investment thesis and actions. Below is a list of our upcoming webinars for which you can register.
Digital Monies and Assets Adoption
As the digitalization of monies, commodities, and assets accelerates, a variety of industries and sectors are adopting these innovations. Learn why this is important for you and your own industry and investing activities.
The Regulatory Landscape for Digital Monies, Commodities, and Assets
Global regulation of digital monies, commodities, and assets is accelerating quickly with pro innovation legislation in process in almost all leading financial centers worldwide. Our UK Partner, Mitch Mechigian, will share how we see regulation impacting the development of blockchain in the years to come.
Recordings of past webinars and calls can be found at www.blockchaincoinvestors.com/webinars.
UPCOMING APPEARANCES
Our team speaks regularly at conferences and seminars around the world. Please join us at any of our upcoming appearances to take deep dives into the most innovative technologies of our time.
We are pleased to once again join Prestel & Partner at their London Family Office Forum on June 20th & 21st. Our Managing Partner, Matthew Le Merle, will speak on the importance of investing in the future through venture opportunities.
RECENT PRESS
CNBC Crypto World: Matthew Le Merle discusses this year’s performance in the space and provides an outlook for 2023
Business Insider: A profile of the firm's investment strategy and why now is the right time to invest in blockchain technology
The Holy Grail of Finance: A podcast with Altvia regarding the inevitability of blockchain technology in conducting digital commerce
Boardroom Governance: Alison Davis gives her unique view on 20+ years of experience in management, investing, and board membership
CoinDesk TV: Interview on unicorns and predictions for 2022
Nasdaq Trade Talks: Discussion on the blockchain unicorn universe research and how to gain exposure
Ashurst: On the ESG Podcast, a discussion of the internet, fintech, blockchain, and individual revolution
Business Insider: Discussing how right now in blockchain is similar to the internet boom of the '90s in terms of growth and innovation
NBC San Francisco: An interview on what are NFTs
Crypto Unstacked: Podcast on the Fifth Era and the evolution of digital assets
BLOCKCHAIN COINVESTORS SWISS
We are excited to announce that Blockchain Coinvestors Funds are now available through Swiss certificates for those of our non-US investors who prefer this approach. The underlying fund is the same, however, our Zurich based team at Blockchain Coinvestors Swiss, who will introduce in future weeks, can provide detailed information regarding this investment option. Email us at mlemerle@blockchaincoinvestors.com to learn more.