Bitcoin Firm NYDIG Acquires Fintech Digital Assets Data

NYDIG is a financial services firm that trades in Bitcoin. The firm announced this week that it has acquired crypto data firm Digital Assets Data. The acquisition is part of its grand initiative to expand its platform. NYDIG says that the acquisition adds to its “best-in-class platform for institutions, hedge funds, high net worth investors, and banks looking to unlock the full potential of Bitcoin as an asset class.”

Although it’s less well known than its rivals, Coinbase or Kraken, NYDIG has more than $4 billion in assets under management and operates a business that spans prime brokerage, corporate treasury, and custody services.

Bitcoin NYDIG
Image credit: NYDIG

NYDIG made the news late last year. Insurance giant Mass Mutual said that it had invested $5 million in the company. It used NYDIG services to acquire $100 million worth of bitcoin for its general insurance account. This was a small investment for the insurance company. Itsgeneral investment account was almost $235 billion as of September 30th. However, the move signals greater momentum for bitcoin, which has surged in Q4 2020. The price of a single bitcoin peaked in late November at $19,835 — more than its 2017 high — and currently trades around $18,000. That is a 150% increase year-to-date.

Digital Assets Data is a fintech and data outfit. It develops enterprise-grade software and data feeds for crypto hedge funds and other market players. The company has raised more than $9 million from venture investors. These investors include Morgan Creek Digital, Digital Currency Group, and North Island.

NYDIG states that the purchase of Digital Assets Data will aid it in expanding its data capabilities, according to a press release.

NYDIG did not disclose any of the financial details of the transaction. However, the company told The Block that Digital Assets Data’s platform will “broaden NYDIG’s digital asset data capabilities to provide even better insights to the firm and its clients.”

“As NYDIG’s client base and the digital asset market rapidly expand, the addition of new high-quality data sources and analytical capabilities serve to enhance NYDIG’s existing research, trading, and advisory capabilities,” the firm said in a statement.

Digital Assets Data has twin brother co-founders — Mike and Ryan Alfred. They are set to join NYDIG head of M&A and head of product, respectively. As the leader of bitcoin mergers and acquisitions, Alfred will focus on identifying potential acquisition targets. NYDIG expects to “significantly” increase the volume of strategic acquisitions in 2021, the company said.

“We’re thrilled to be adding the powerful data capabilities developed by Mike and Ryan Alfred and the Digital Assets Data team to our full suite of technology-driven financial services solutions,” said Robert Gutmann, co-founder and CEO of NYDIG. “This acquisition enables us to provide our clients with an even broader array of data and intelligence to drive research and inform trading decisions. As the institutionalization of Bitcoin accelerates, so does the need for enterprise-grade data and tools to support it.”

Digital Assets Data came into exiztence only two years ago. The company provides a data and research platform to deliver institutional-grade information and insights on digital assets to its customer base of professional asset managers, hedge funds, family offices, and institutional investors.

The company’s platform provides asset managers with information and tools to monitor and manage investments, conduct due diligence, and make investment and trading decisions.

The NYDIG acquisition is one of the first of 2021. This year is one in which many market observers anticipate to see a whirlwind of M&A activity.

One analysts said that the data and analytics is one sector of the crypto market is primed for M&A activity.

Since to 2016, there’s been a total of 26 deals conducted in the crypto data and analytics space. Those deals added up to $460 million.

Many say that the blockchain and cryptocurrency industry is developing. Nevertheless, it presents numerous opportunities for companies that can position themselves at this point in time.

Ryan Carpenter serves as Attorney and Managing Director of Carpenter Wellington. Ryan advises clients across a broad set of corporate and commercial matters.