Last week Matt Harcourt, Hans Diederen and I had the pleasure of attending Token 2049, the leading crypto conference organised annually in Singapore and London. Token 2049 is a wonderful event bringing together founders and executives of leading web3 companies to share their views on the crypto market.

Below we share our insights, with the key insight being that, unlike the last bear market, which saw a noticeable reduction in crypto activity, crypto activity is flourishing despite the current bear market.

It was encouraging to see Singapore put on such a high-profile event despite the cautious standpoint of the regulators concerning crypto in the city-state. Notable crypto exchanges crypto.com and OKX are major sponsors of the Formula 1 race in Singapore that followed the conference. Crypto-related advertising for Token2049 was also prominent at the Singapore Changi Airport.

Singapore is booming with an inflow of people and capital from Hong Kong and China, supporting a relatively strong currency and property market.

The event was the biggest yet, with over 7,000 attendees and 2,000+ companies spanning entrepreneurs, investors, and developers that held workshops, hackathons and networking events unparalleled to any other past crypto conferences we have attended in Singapore.

It is clear that the Gaming/NFT space had a large representation and has gained a lot of activity. The DeFi projects, even though still present at the conference, could be somewhat of a contrarian bet in this current market.

‘The Dawn of Web3 Gaming’ presentation with the founders of Axie Infinity, Mechanism Capital and Delphi Digital

 

Many young developers are focused on building out NFT Financialisation, we think the underlying narrative will drive high growth valuations in the next up-cycle.

‘Liquidity in the Institutional lending markets to crypto-native firms are beginning to return to normal after being heavily impacted by the 3AC and Celsius event in May’ comments from Galaxy Digital.

Global crypto Venture Capital firms describe Australia’s crypto scene as compelling and intriguing.

Henrik Andersson, CIO of Apollo Capital, talking on a panel with industry leaders

 

Apollo Capital bolstered new and existing relationships with some of our reciprocal venture partners. Face-to-face introductions to global crypto Venture Capital firms is the most effective way to start a relationship, resulting in higher quality deal flow.

Know Your Customer / Know Your Business and Anti Money Laundering solutions had a strong presence due to the increased regulation narrative within crypto. We think ‘permissioned’ DeFi will make institutions and banks more comfortable with on-chain finance (OnFi).

In the wake of the past 12 months of hacks within DeFi,  many crypto VCs are not comfortable taking on large amounts of smart contract risk. We feel we are one of the best in analysing this risk due to 91% positive months with almost 100% exposure to smart contract risk at any one time in the Apollo Capital Opportunities Fund.

Gaming is hot despite investors agreeing that no project has good enough tokenomics. The gaming and NFT projects are now past their ‘hype’ phase, moving away from simply ‘adding crypto’ to traditional gaming models towards incorporating crypto natively from the ground up in their designs.

We met with the founders of crypto asset investments held by Apollo Capital, some of which have been primary investments made by the funds and secondary bids.

• 1inch
• Dydx
• Insrt finance
• Pendle Finance
• Magpie
• Maverick
• Mirror Planet
• Mycelium
• Perion 
• Strips Finance
• Solv Finance

We also met with Maple Finance and Clearpool which we have provided liquidity to.

A busy ground level at Token2049 Singapore 2022

To summarise;

• It is clear that there is still a lot of ‘money on the sidelines’ looking to be deployed in the coming year.
• Retail interest in crypto is still very strong.
• Good builders are continuing to ship products despite a difficult market.
• Singapore is still unseated as a hub in the Asia region for crypto.

We will see you next year Token2049 Singapore!