Cryptocurrency asset management company Bitwise successfully raised $70 million

According to CoinDesk, Bitwise, a cryptocurrency asset management company that is entering the US$20 trillion financial consulting industry, has successfully raised $70 million and is valued at $500 million.

Bitwise’s Series B round was led by tech investor Elad Gil and cryptocurrency venture fund Electric Capital. Some Wall Street billionaires also participated, including crypto-backed hedge funds (Daniel Loeb, Stanley Druckenmiller) and top investment firm executives (Blackstone’s Nadeem Meghji and Bridgewater’s David McCormick).

Bitwise, which is five years old and already profitable, Chief Executive Hunter Horsley said, plans to further strengthen its connections with financial advisors, which he said is critical to widespread adoption. He said about 300,000 financial advisors manage the majority of private wealth in the U.S.

Horsley predicted in an interview that most Americans “will own cryptocurrency in some way over the next 10 years,” and he said hitting that benchmark requires making cryptocurrencies an undifferentiated investment, just as their fund managers understand stocks, bonds and exchange-traded funds (ETFs).

“They’re not trying to trade events or outperform the market, they’re just trying to make crypto fit in with the rest of their investment life,” he said.

Bitwise is growing

Bitwise has partnered with 200 financial advisory firms, more than double the number in January, and plans to find more partners by strengthening its client education resources and relationship management team.

These back-office employees help Bitwise sell its product: cryptocurrency dressed in “Wall Street clothing.”

Bitwise offers BTC and ETH funds; thematic index funds that go long on DeFi tokens; and similar ETF products like the Crypto Industry Innovators ETF (BITQ), which invests in companies like MicroStrategy and Riot instead of cryptocurrencies.

The move has helped Bitwise reach $1.2 billion in assets under management, Horsley said. BITQ has received $45 million in inflows since listing on the New York Stock Exchange in early May.

The hope of ETFs

Horsley said the funding will give Bitwise additional headroom to develop more products more quickly: “You’re going to see more products from us this year.”

All of this seems to make Bitwise a natural contender for a Bitcoin ETF. In fact, the company has previously tried to ease into Wall Street through an ETF. But after months of obstruction from the U.S. Securities and Exchange Commission, Bitwise abandoned its bid in early 2020.

At least for now, Bitwise is still on the sidelines as at least nine other companies try their luck before the new SEC chairman takes office.

“The ETF is a great wrapper,” Horsley said. “But we’re growing 20 times year over year without a bitcoin ETF. We can open up all sorts of different avenues to help investors introduce cryptocurrencies into their investments.”

Figure | Bitwise celebrates the listing of its BITQ “Industry Innovator” ETF (Source: NYSE/Bitwise)

Legendary supporter of Bitwise

Bitwise's new investors include many heavyweight investment firms such as Druckenmiller, Loeb, Henry Kravis, the famous cryptocurrency fund Coinbase Ventures, ParaFi, and tech finance executives from more than 30 companies including Facebook, Google X, Bridgewater, Spotify, Visa and Instacart.

When two major investors, Gil and Electric Capita, joined Bitwise, institutional cryptocurrency adoption was more of a thought experiment than a reality. More than a year after large financial firms entered the space, that has fundamentally changed.

Avichal Garg, co-founder of Electric Capital, said Bitwise has been careful to build a list of funding that is “just legendary.”

“You really need to understand crypto,” Garg said. “But you also have to understand traditional finance, Wall Street and asset management. So I think the investors they’re bringing in are somewhat reflective of that.”

He said equity investors are betting that Bitwise is the "leading asset manager" for the cryptocurrency market, which he believes can still grow 10 to 100 times. Once you start talking about capital flows to assets, and $20 trillion in the hands of asset managers, it's not crazy to think that Bitwise could be the "primary conduit" for hundreds of billions of dollars in inflows from private asset managers.

Long-termists

Horsley said the round came after bitcoin’s April high, saying: “If $60,000 was the high, then this round came after the high.”

As it happens, Bitwise’s seed round, a $4 million round in late 2017, was raised right as the Bitcoin market was approaching its historic $20,000 peak, followed by a massive 65% sell-off in less than a month. Bitwise announced its seed funding just weeks before the market peaked.

Bitwise backers were and are long-termists, Horsley said.

“They see this as an asset class that’s here to stay, and they see Bitwise as having the potential to be a lasting institution in the space,” he said.

<<: Microstrategy's $1.5 billion "new bullet" has become a reality Bitcoin ETF, but there are two major risks

>>: Paul Tudor Jones May Go All-In on Inflation Trading, Wants to Allocate 5% to Bitcoin

Coin Zone Trends: Bitcoin Price Trends Based on Big Data This Week (2017-08-08)

Cryptocurrency

What does it mean for a man to have fewer eyebrows? What does it mean for a man to have fewer eyebrows?

Blog

Mining machine manufacturer Yibang is involved in another lawsuit to claim hundreds of millions of yuan from Xiaomi's investment in chip company

Cryptocurrency

Valuable datasets stored via Filecoin Slingshot

Cryptocurrency asset management company Bitwise successfully raised $70 million

Coin Zone Trends: Bitcoin Price Trends Based on Big Data This Week (2017-08-08)

What does it mean for a man to have fewer eyebrows? What does it mean for a man to have fewer eyebrows?

Mining machine manufacturer Yibang is involved in another lawsuit to claim hundreds of millions of yuan from Xiaomi's investment in chip company

Valuable datasets stored via Filecoin Slingshot

IPFS mining machine has landed! Rabbitbit H16

Spending $1 of Bitcoin on the dark web can launder at least $800 of "stolen money"

What kind of face is considered auspicious?

Palmistry characteristics of being born rich

Russian nuclear engineer arrested for using supercomputer for mining? !

Simple and crude, teach you how to read palmistry quickly

Recommend

Bikan raised tens of millions of RMB in its A round and launched a new Bitcoin OTC product

What does a woman with a square forehead look like?

Blockchain startups are rewriting the rules of business

New changes in the global financial order: US strategic Bitcoin reserves

What causes red moles on the back? Is it good to have a mole on the back?

On the last day of 2020, can Bitcoin reach 30,000?

What does a woman's broken palm mean and what are the effects

What does a woman with a mole under her left eyebrow look like?

Interpretation of whether a man's hump nose is good or not, what is the fate of a man with a hump nose

Iran Officially Recognizes Crypto Mining Industry, Will Draft Policy Framework Within 18 Days

Legal case: How to unfreeze millions of RMB from frozen bank cards after selling USDT

UK government considering paying research grants with Bitcoin

What are the facial features of girls who are prone to late marriage?

The face of a person with a particularly active mind

Iran requires crypto miners to register their identities and mining farms with relevant authorities within one month