Permissionless and decentralized are the characteristics of the encrypted world, which makes the encrypted world like a deep dark forest: rich in opportunities but hidden risks everywhere. And those projects with the endorsement of well-known institutions have become a relatively simple rule for investors to choose projects.
In the encrypted world, every move of some well-known investment institutions has attracted much attention. In 2020, Multicoin Capital has become a hot spot in the market. Investors sort out Multicoin's portfolio one by one to capture the next value depression. This summer, Coinbase investment projects have become a new hot sector, and projects invested by Coinbase but not traded on Coinbase have become a "up" signal.
When it comes to the phenomenal rise in the market this year, the Solana ecology is an unavoidable topic. Alameda Research, which has invested heavily in the SOL ecology, has received good returns. At the same time, another important investment institution in the Solana ecology, Jump Trading, is also worthy of attention. Jump Trading has supported Solana's ecological leader DEX Serum, revenue aggregator Tulip, oracle machine Pyth, cross-heterogeneous chain universal communication protocol Wormhole, etc. through investment or participation in the development. Jump Trading also has a long-term layout in the Solana ecosystem.
It is not difficult to find that Jump Trading is another investment institution besides Alameda that has made a lot of money in the Solana ecosystem. And this is not the first time that Jump Trading, a traditional high-frequency trading giant, has made a move into the encryption field. In mid-September, Jump Trading announced the launch of a new $350 million fund. The fund is the seventh fund launched by Jump Capital and will be used for crypto-related capital investment, stock investment and token investment in DeFi, financial applications, blockchain infrastructure and Web 3.0 fields.
The launch of Jump Capital also means that this veteran capital will finally enter the encryption world. Although Jump Trading has long attempted to maintain a low-key public image, the company has a long-standing reputation in the market. We found Jump Trading’s holdings on Nansen, and looking back at Jump’s investment projects, how do we understand the investment logic of this veteran capital? (The amount of currency held is complicated, and Rhythm only lists some of its holdings)
Among the positions held by Jump Trading, most of them are relatively mature projects. Among the 10 projects selected in this article, only Sperax ranks outside the top 1,000 in market capitalization, and most of the rest are in the top 200 in market capitalization. Observing its positions may help us better understand its investment style and capture the next hot sector in the market.
Looking at the Jump Trading list, Rhythm BlockBeats found that among the 10 positions we listed, Jump Trading's positions cover DEX, DeFi, Web 3.0 and other fields. Jump Trading focuses on protocols that promise to be ecological infrastructure. For example, the importance of multiple DEXs goes without saying, but projects such as oracle machines, savings agreements, synthetic assets, and Stablecoin have enriched the ecology very well, and are necessary to build a highly active and highly liquid DeFi world .
Perhaps we can understand that Jump Trading started with trading and has developed to this day. Their understanding of capital efficiency and trading is excellent, which is also their inherent advantage in capturing the next growth point in these fields. Such as the improvement of liquidity by Compound, and the first Stablecoin built by Sperax, the innovation of these protocols can improve the capital efficiency of the chain world. This kind of ecologically valuable innovation should also have more long-term value and be more attractive to investors.
The investment in Web 3.0 is more open. Everyone can see the trend of Web 3.0, but no one knows which path will eventually lead to success. Jump Trading is making big bets in areas it's more familiar with - optimizing trades and capital efficiency - while remaining open to future trends. This is an investment approach that combines aggressiveness with a conservative risk avoidance strategy.
DEX
Jump Trading has been investing with its own funds since its establishment in 1999. The world's top traditional investment giant evolved from CME and is one of the largest traders in traditional asset classes. With over 1,000 employees in New York, Chicago, Amsterdam, London, Shanghai, and Singapore, the firm is active in futures, options, cryptocurrencies, and global stock markets. As a company born and grown from trading, Jump Trading's emphasis on DEX is a natural fit.
In the encrypted world, transactions are the most carried data on the chain. The crypto market structure is full of nuance and different idiosyncrasies at every level of the stack. Complex trading systems tend to amplify these nuances, and scale amplifies them even further. Kanav Kariya, head of Jump Crypto, once pointed out in his own article, "The main focus of our early work was to build a powerful platform that enables users to participate in these special markets in large quantities and elegantly. Combined with no-nonsense transaction intelligence, accompanied by encryption With the continuous development of the field, this market will allow us to lead the market players." Among its holdings, we found multiple DEX project tokens.
Serum
As of today, Jump Trading holds about 3,000 SRMs, worth about $10,000.
In September 2020, Jump Trading invested in Serum, the leading DEX on the Solana chain. SBF once revealed in an interview with the media, “Serum is the first project that Jump Trading has set foot in and invested in the DeFi field.” And just for the “first set foot in”, Jump Trading’s investment has achieved remarkable results-SRM token is dubbed by the market as “SBF four One of the "Piece Sets", ushered in a good increase. According to CMC data, in September 2020, the SRM Token was only $1.84 per token, while in September this year, the highest value of SRM reached $12.48.
Unlike most DEXs that use the "automatic market maker (AMM)" mechanism, Serum uses the same order book mechanism as CEX. The advantage of this design is that it will not produce a large slippage like AMM. However, limited by network performance and order processing speed, this mechanism was not common in the previous DeFi world. Serum took advantage of the high TPS characteristics of Solana to design a central order book, which can integrate the flow of other multiple protocols on the chain.
BitDAO
As of today, Jump Trading holds about 390,000 BITs, worth about $740,000.
In June this year, Bybit, a well-known trading platform for derivatives trading, announced that BitDAO, led by it, announced the completion of financing of 230 million US dollars. Bybit also made a commitment to contribute 0.025% of its futures contract trading volume to BitDAO's treasury. Based on the revenue from January to May this year as a reference, it is expected to exceed US$1 billion per year. This is also regarded as the most direct value support of BitDAO.
BitDAO plans to take a different path from Bybit. By investing a lot of capital and talents in the DeFi field, BitDAO will move towards a decentralized path. BitDAO calls itself one of the largest decentralized autonomous organizations (DAOs) in the world. BitDAO will be committed to three things, research and development, circulation and funding. Develop BitDAO DeFi products, provide liquidity for DEX, lending, synthetic assets and other agreements, and donate to support emerging projects. In addition, this is known as the world's largest DAO will also. Previously, Bybit has never issued tokens, and Bybit and BitDAO are also jointly regarded as the value support of BIT tokens.
From the perspective of BitDAO's vision, the planning of this project is not unreasonable. The "world's largest DAO" leaves investors with a lot of room for imagination. In the wallet of Jump Trading, we also saw the BIT holdings.
1inch
After the popularity of AMM and the explosion of DEX, DeFi transactions have become a force that cannot be ignored in the market. However, the rise of a large number of AMM projects has also brought about a new problem - the "fragmentation" of liquidity. Especially for large transactions, the cost of slippage is a transaction friction that cannot be ignored. Aggregation platforms like 1inch have solved this fragmentation problem to a certain extent.
1inch can aggregate the liquidity of multiple protocols to provide traders with the best quotes. Specifically, 1inch will split the exchange request sent by the user into multiple parts, and then deal from multiple different DEXs respectively, so as to achieve the optimal result of the total transaction price.
Before EIP1559, due to the characteristics of the ETH network, the high gas fee has always been a major worry for DeFi users. (Of course, this problem will still be solved after the implementation of EIP1559.) 1inch launched the gas fee in May last year. Tokens also provide users with a better solution to save gas expenses: gas token. Chi is a functional token developed by 1inch. It saves gas for users by storing gas in CHI when the price is low, and burning CHI to release gas and use it when the price is high. With the implementation of EIP1559, although the use of gas token has come to an end.
Although CHI gas token has been deprecated, we cannot deny the innovation and value of this project, let alone 1inch's contribution to the ecology. As of today, Jump Trading holds about 690,000 1INCH, worth about $1.72 million.
DeFi infrastructure
As DeFi becomes the main category of on-chain applications, the infrastructure that supports the ecological operation of DeFi has become the focus of attention. There are many subtle and complex economic mechanisms behind some of the most exciting and successful projects in the DeFi space.
Oracles, storage protocols, synthetic assets, Stablecoins... Jump Trading's investment record in this field is enough to prove that they are already familiar with this track. This may be the more conservative part of Jump Trading's portfolio. Jump Trading believes that “the rise of DeFi has paved the way for Jump to bring two decades of trading expertise and engineering technology into the encryption field, attracting them to explore the magical Internet currency rabbit hole.”
Among the positions held by Jump Trading in this field, in addition to the top 100 projects by market capitalization such as ChainLink, Compound, and Synthetix, there are also many early-stage projects with low valuations, which may become the "wealth code" for everyone.
Compound
Jump Trading’s wallet address currently holds about 20,000 Compound positions, worth about $4.17 million.
In the "DeFi Summer" of 2020, Compound shines. The protocol rewards protocol contributors with "liquidity mining", which enables Compound to jump-start the protocol at an early stage. Lending, as the infrastructure in the DeFi field, currently has a relatively stable structure. Compound, Maker, and Aave are three points in the world, and their corresponding tokens are also regarded as DeFi blue chips.
With the advent of the multi-chain era, many well-known protocols are deployed across chains. Different from other lending protocols, Compound's multi-chain solution is unique, and it has developed the Compound Chain itself. Compound Chain is a distributed ledger that can transfer value and liquidity between peer-to-peer ledgers. Based on Compound Chain, users can borrow and lend cross-chain assets from different blockchains such as Polkadot, Quorum, Solana, and Celo. Compound Chain aims to complement Ethereum contracts, and plans to issue native token tokens to pay transaction fees, while COMP still serves as a governance token.
In May of this year, Jump Trading once purchased more than 47,000 COMP, becoming the eighth largest holder of COMP, second only to a16z and Polychain among investors.
Synthetix
In the wallet address of Jump Trading, we found as many as 200,000 SNX tokens, worth about $1.13 million.
Synthetix is a decentralized synthetic asset issuance protocol built on Ethereum. This protocol allows users to mint, hold and trade a variety of synthetic assets, including fiat currencies, commodities, stocks, and crypto-native BTC, MKR, LINK and other cryptocurrencies.
Synthetix also issued an over-collateralized Stablecoin sUSD. Users can mint sUSD by staking sufficient SNX. Synthetix's innovative synthetic asset model has aroused the market's pursuit as soon as it was launched. At present, SNX token has also become the leading token of synthetic assets. As of now, the total circulating market value of SNX exceeds 1.1 billion US dollars.
Sperax
Jump Trading’s wallet address currently holds 3.61 million SPA tokens (but according to Reddit netizens, there are more than 30 million SPA tokens in another Jump Trading associated address).
Among the many DeFi projects mentioned in this article, Sperax is the most unique one. Sperax is committed to building a full-stack DeFi ecosystem based on the native hybrid Stablecoin Sperax USD (USDs) and using decentralized products such as Sperax Synthetic Asset and Derivatives as application scenarios. This may be one of the reasons for Jump Trading's investment.
The Sperax core design team consists of Nicolas Andreoulis, a former founding member of Terra, and Prof. Marco Di Maggio from Harvard Business School (these two are founding members of Terra, and designed UST, Anchor, Mirror and other Terra ecological core products before leaving Terra ). The market value of Terra, which Sperax is targeting, is currently 17 billion US dollars, and the market value of Sperax is about 20 million US dollars. Sperax has issued the first interest-bearing hybrid stablecoin (USDs) in the current market. One of its characteristics is that it can provide passive interests income for minter. This project is favored by many institutions such as Messari, Jump Trading, Alameda Research, and Amber. Messari praised it as a new generation of Stablecoin project with "great potential to change the Stablecoin track".
Web 3.0
Web 2.0 and centralized giants have been in this world for far too long. By disrupting traditional business models centered on corporate interests, Web3 shows us the possibility of community-focused economies of scale. This spirit of collaboration and its associated incentives will attract the most talented and ambitious developers in every technology field today, and they will develop many, many projects that have never been seen before.
As in-depth author Ki Chong Tran said in a previous article published on Decrypt, Web 3.0 is "the next major change in the Internet, and it may help people take back control from the centralized enterprises that dominate the Internet today." . Jump Trading also has a layout in the Web3.0 field. From its holdings, we also naturally found the tokens of the current popular Web 3.0 projects.
Audius
Under the tide of the Web 3.0 era, there are always some areas that will enter the Web 3.0 era earlier than others. Audius, a decentralized media music platform, is one of the pioneers of this era. Audius is dedicated to creating a decentralized and open source streaming music system controlled by artists, fans and developers. The company mainly helps music producers and artists connect directly with fans and get paid for their music without any middlemen on the platform.
The data shows that music artists can only get about 12% of the total income of their works. For new artists or niche musicians, without sufficient support, they cannot continue to create. Audius not only hopes that "middlemen will no longer make the difference", but also the platform operator's responsibilities are clearly limited to music discovery/hosting and adjusting incentives according to creators and listeners, rather than playing traditional distribution roles like Spotify and Apple Music. Previously, Audius Music was also officially recommended by the Apple App Store.
As of today, Jump Trading holds about 570,000 AUDIOs, worth about $1.89 million.
Mask
In the era of Web3.0, how to bind the wallet address with your social identity is also particularly important, especially when we use our NFT more in social. Mask Network has already led the NFT and SocialFi tracks with a plug-in, and has laid out a variety of functions including sending and receiving red envelopes on Twitter, publishing encrypted tweets, displaying and purchasing NFT, etc. In addition, this plugin also integrates information platforms such as CoinGecko and CoinMarketCap, and accesses decentralized applications such as Uniswap, SushiSwap and QuickSwap.
And Mask Network is doing much more than that. In addition to identifying and displaying NFT functions of platforms such as OpenSea on Twitter at the beginning of the year, Mask has also recently launched NFT Gallery (NFT wall), NFT Avatar (NFT avatar), NFT red envelope functions, and also The NFT avatar function has been launched for some users, and it may even support the use of NFT to fight monsters in the future, and experience the cool elf function similar to QQ pets.
Through browser plug-ins, Mask Network allows people to experience Web3.0 and Metaverse earlier on the Web2.0 platform in a simpler way. As of today, Jump Trading holds about 29,000 MASKs, worth about $320,000.
Jump Trading: Infrastructure Builder
Although Jump Trading's investment portfolio covers multiple tracks, these projects have common characteristics: more eco-friendly, promising infrastructure, advanced technology and ambitious vision, and these investments have also made Jump Trading quite profitable. By observing its portfolio, it is not difficult to find that Jump Trading prefers ambitious projects that are expected to become encryption infrastructure.
We can also see this investment strategy of Jump Trading in other projects: in September this year, Jump Capital invested in Eden Network. As of now, Eden's computing power has accounted for more than 50% of Ethereum's entire network computing power. Jump Capital participated in the construction of the Pyth network, and Pyth is outputting a variety of data including the stock price of the compliant securities trading platform to the chain. Jump Capital, as the initial code contributor to Wormhole, has achieved fully universal communication across heterogeneous chains…
On the official website of Jump Capital, there is a sentence in the most prominent position: "Jump Capital is moving towards building the next generation of cutting-edge encryption infrastructure." Kanav Kariya, head of Jump Crypto, once wrote, "Building (to build) has Be the rallying cry of the team: build undersea tunnels and railroads, build community, gain a deeper understanding of the crypto ecosystem, and unearth a treasure trove of system design and engineering problems.”
“Blockchain has opened up incredible new models of resource coordination, by enabling trust between distrustful parties. They make the community truly a stakeholder.” Their goal, however, is to “help lay the paving stones .” Investing in infrastructure may be their way of “paving the way.”
