Pantera Capital: “given the increasing number of entrepreneurs building applications on top of Ethereum in recent months and its resurgence in discussions we and other industry members have had, attention to it must be renewed.”
Snippet from the latest Pantera Capital newsletter.
Ether, the digital token-currency of Ethereum, has become the second largest digital currency by market capitalization, behind bitcoin. Recently, ether’s overall market cap eclipsed a $1 billion threshold, which has only been achieved by one other digital currency, Bitcoin. Just before that, earlier this month, Ether’s market cap climbed above $600 million for the first time, surpassing the combined market cap of alternative digital currency veterans Ripple and Litecoin (the now 3rd and 4th largest digital currencies by market cap, long time 2nd and 3rd), up from its usual market cap of around $450 million.
Ether price has recently reached new highs partly driven by public interest generated from a Microsoft partnership and recruitment interest from Thomson Reuters. Microsoft has included the Ethereum startup BlockApps, which provides Ethereum blockchain software for enterprises, into its Azure Blockchain-as-a-Service marketplace (Azure is Microsoft’s open, flexible, enterprise-grade cloud computing platform). The company fits in with Microsoft’s goal of enabling enterprises and developers to quickly deploy a blockchain environment on Azure. Thomson Reuters is in search for a talented blockchain developer, who is well-versed in the Ethereum distributed ledger technology and can design and implement complex distributed ledger solutions for the company, an additional sign of Ethereum’s growing legitimacy.
Ethereum In Action
Pantera has always been ledger-agnostic when evaluating blockchain investments and has been monitoring Ethereum since the beginning. Before taking it seriously, we were waiting for the technology to gain legitimate traction and to see if it could actually be implemented in compelling use-cases. A big indicator of progress to us was when some of our own portfolio companies began incorporating Ethereum into their application technology stacks. Below are some interesting use-cases being built on the technology:
Chronicled, a Pantera portfolio company, is a company providing authentication and provenance using blockchain technology. The company has developed pilot implementations on both Bitcoin and Ethereum blockchains and finds the Ethereum framework and coding language to be the most user-friendly and flexible of the two. Chronicled has not formally announced their commitment to Ethereum and are waiting to see convergence in the blockchain space before any commitment. That said, based on our informal conversations with the team, it does feel that Chronicled is leaning in the direction of an Ethereum blockchain implementation.
Slock.it is a “smart contract lock” that is run on the Ethereum blockchain. The company has partnered with energy giant RWE to reinvent how electric cars are charged today. Cars will be equipped with digital wallets and will be able to communicate with autonomous electric charging stations, which use smart contracts to allow users to rent the station, put up a deposit, charge their car, then get their deposit back. In another case, Slock.it would enable for charging the electric vehicle by tiny increments, using induction points beneath the road while a car is waiting at a traffic light. Smart contracts remove the complexity of paper contracts. Normally the charging stations charge by the hour and there is no way to pay for what you use, so the experience is suboptimal. With slock.it, users will be able to see how much energy they are consuming. When charging is complete, the charging station refunds a deposit through a smart contract.
Founded in 2013 as the first U.S. Bitcoin investment firm, Pantera Capital is the leading blockchain investment firm and one of the largest institutional owners of bitcoins. Our mission is to act as the catalyst for widespread blockchain adoption and innovation.
Exclusively focused on investing in blockchain technologies, the Pantera team is experienced in both traditional finance and the emergent blockchain technology. Having strong relationships with some of the most promising entrepreneurs and other top investors in the space, Pantera is fulfilling its strategic investment philosophy by building a diversified portfolio and bringing industry-specific value-add resources to its portfolio companies.
Within the next several years, we envision blockchains and digital currencies having an established, responsibly managed, and regulated role in the global economy, soon after disintermediating a myriad of industries.
Pantera’s portfolio investments include bitcoin services provider BitPesa, exchange platform Bitstamp, BitPagos Inc., 21 Inc., ChangeTip, Circle and Xapo.
In 2014, Pantera announced a partnership with Fortress Investment Group, Benchmark and Ribbit Capital to create a shared bitcoin investment fund led by Pantera, Pantera Bitcoin Partners. Of the deal, CEO Morehead said, “We believe Bitcoin is at an inflection point, making it the right time for a transition to more institutional management.” The partnership was said to indicate “a significant step in the push to move Bitcoin into the financial mainstream.”