First up eFinancial News, Jan. 15:
Blythe Masters opens blockchain shop in London
Blythe Masters, the former head of JP Morgan's commodities business on Wall Street, is bringing her blockchain start-up to Europe.Here's the press release.
New York-based Digital Asset Holding said in a statement on January 15 that it will open an office in the UK capital to support clients in Europe.
Justin Amos, a managing director at compliance technology vendor NICE Actimize, who formerly spent 14 years at JP Morgan, will join Digital Asset in February to lead its European operations.
Digital Asset is building software that uses distributed ledgers, including blockchain – the underlying technology behind cryptocurrency bitcoin – to settle trades made in mainstream financial assets, as well as digital assets. It aims to reduce counterparty risk and make settlement faster, cheaper and more secure.
Masters, CEO of Digital Asset, is widely regarded as one of the most influential women on Wall Street, having spent almost three decades at JP Morgan before leaving the bank in 2014. Shortly after joining Digital Assets in March 2015, she told Financial News: "The reason why I did this is because it is a massive opportunity. I can see how distributed ledger technology is going to change the way modern finance works.”...MORE
And from the NYT's DealBook, Dec. 28.:
Start-Up With Bitcoin in Its DNA Stumbles on Fund-Raising Trail
The newest venture from Blythe Masters, until recently a star banker at JPMorgan Chase, appeared to be an overnight success story in the making.Her start-up, Digital Asset Holdings, is working in one of the hottest areas of growth on Wall Street today: the blockchain technology that underlies the virtual currency Bitcoin. And Ms. Masters has already received a promise from JPMorgan, her former employer, to be the lead investor on the new project, pitching in around $7.5 million.But Ms. Masters’s company has been struggling for months to close the deal with other investors. Most recently, large banks including Goldman Sachs and Citigroup have balked at putting money into Digital Asset Holdings after learning that JPMorgan was being given better terms than other investors, according to several people briefed on the deal.The banks and financial firms looking into investing, the people said, have also expressed doubts about the actual software solutions Ms. Masters’s start-up is working on, much of which has been put together through purchases of smaller start-ups.“The deal would need to improve materially for us to get involved,” said one executive at a financial firm, who has been looking at putting money into Ms. Masters’s company, speaking on the condition of anonymity because negotiations were continuing. “It’s not supercompelling.”Digital Asset Holdings’ head of business development, Beth Shah, said assertions that the company was facing challenges in raising funds were inaccurate but she declined to provide further details. All of the potential investors declined to comment.The challenges that Ms. Masters is facing reflect in part the increasingly difficult environment facing start-ups of all sorts as investors have begun to worry that the tech industry has been overhyped and overvalued, pushing down values for companies both public and private.She is also contending with the difficulty of building a viable business around the virtual currency Bitcoin and the various technological concepts it has introduced to the financial industry, most of all the blockchain.The blockchain is the database on which all transactions on the Bitcoin network are recorded. Unlike normal databases, the blockchain is maintained by everyone using the database in a decentralized fashion. That has led many in the financial industry to hail it as a faster — and more reliable — alternative to existing transaction systems.Digital Asset Holdings is proposing to build something similar to the blockchain database, in order to provide a cheaper and faster way to trade other sorts of financial assets, such as loans and foreign currencies.The problem for Ms. Masters is that several other start-ups are trying to do something similar, and there is no guarantee that any of the start-ups will ultimately succeed. Many industry experts think that it could take years to get to the point where the blockchain technology can be used effectively by banks — if it works at all.The New York-based start-up ItBit, which is building its own blockchain-like technology, had been out trying to raise $100 million based on the assumption that the company was worth $250 million. More recently, it has scaled that back and is now hoping to get $50 million from investors, with a valuation of $135 million.Ms. Masters hopes to raise from $35 million to $45 million, valuing the company at $100 million.