Messari raises $35M to expand ‘Bloomberg of crypto’ ambitions

September 21, 2022, 1:28 PM UTC
Portrait of Messari CEO Ryan Selkis in a dimensional background
Messari CEO Ryan Selkis
Photoillustration by Fortune; Original photograph courtesy of Messari

Not bad for a Two Bit Idiot. The “idiot” in question is Ryan Selkis, who uses the tongue-in-cheek monicker for his popular Twitter account, and who just raised a $35 million Series B round for Messari, the crypto data firm he founded in 2018.

The funding round, led by Brevan Howard Digital, reflects the growing popularity of Messari, one of a handful of firms that have made a business of transforming blockchain data into standardized reports. Selkis likens Messari to the crypto version of Bloomberg, the financial news and data colossus.

While Messari’s collection of charts and reports offer investors a clearer picture of the crypto landscape, Selkis also views the service as laying the groundwork for a future era where much of the current corporate compliance and reporting regime will become unnecessary.

According to Selkis, the transparent nature of blockchains means data about things like insider selling and governance decisions is visible to all—meaning that, one day, investors will no longer need a central government authority like the SEC to compile and publish company data.

“If we can prove that anyone can look at a protocol and come up with financial criteria for these blockchains, it will alleviate the need for centralized reporting. And there’s no reason blockchains can’t provide the same for public equities,” Selkis told Fortune.

But while blockchain-based projects may offer a level of transparency that traditional companies do not, few people are able to parse raw blockchain data. Most projects, meanwhile, are not equipped to package their data into a standardized reporting format.

This situation has allowed Messari to build a two-sided business in which it sells subscriptions to investors while also charging blockchain protocols to compile and package their data. Selkis declined to provide specific revenue figures for Messari, but said the company has 35 to 40 blockchain projects, including familiar names like Uniswap, Compound, and Solana. He added that he believes Messari is the largest crypto subscription by revenue.

Messari’s competitors include The Block, a crypto news site that also has a significant research divsion.

The emerging business of standardizing may seem like an attractive opportunity for established financial giants but Selkis is not worried about competition from the likes of Bloomberg or JPMorgan.

“If you can’t outcompete incumbents, you deserve to go out of business,” Selkis said, adding that incumbents typically pull back from investing crypto during downturns—a time he says is ripe for investing.

New products, new politics

Messari, which also raised a $21 million Series A round in 2021, intends to direct the bulk of the new funding round to expanding its analytics and forensics service. The new round also coincides with the launch of new products that will help investors compare crypto assets across multiple networks, and to create customized data sets.

The other Series B investors include Morgan Creek Digital and FTX Ventures, as well as existing investors Point72 Ventures, Kraken Ventures, Uncork Capital, Underscore VC, Galaxy, and Coinbase Ventures.

The new products and investment, Selkis says, will help Messari achieve its goal of developing the crypto equivalent of GAAP-style standardized reporting for the crypto industry.

Meanwhile, Selkis continues to a vocal advocate for reforms to the U.S. regulatory regime and to the country’s political system more broadly.

In this Two Bit Idiot persona, he frequently rails against “Goldman Gary”—his sobriquet for SEC Chairman Gary Gensler, who Selkis argues is actively hostile to the crypto industry and whose political ambitions have caused him to deal with the industry in bad faith.

His political diatribes also include laments that the U.S. has become a gerontocracy where political leaders in their 80s refuse to cede power or ideas to a younger generation.

Selkis, who’s hinted at national political ambitions of his own, acknowledges that he may need to “sand off the rough edges of his tweets” but that, in terms of substance, he has no regrets about the content of his tweets.

For now, Selkis is focused on building Messari as so-called “crypto winter” drags on. Having worked in crypto for more than a decade over multiple downturns, Selkis says he is not fazed by the current slump, though he notes it’s differs from earlier ones in that this is the first “winter” that coincides with macroeconomic upheaval.

Messari’s funding announcement coincides with Mainnet, an annual New York City crypto conference created Selkis that has become a flagship event for the industry. This year’s speakers include the CEOs of Binance and Coinbase as well as the inventor of Ethereum, Vitalik Buterin.

Asked whether he had advice for would-be crypto founders, Selkis offered a pithy response.

“Wear a helmet,” he said.

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