Placeholder and Paradigm have already made 170% on NMR investment
There are investors who make timely market calls (they buy the bottom). There are investors who make the right investment call (they invest in the right company or market). Occasionally, there are investors who make both timely and correct investments.
Placeholder and Paradigm led an $11 million round in numeraire (NMR) on March, 21 2019. Since the initial investment, numeraire, the native token of the Erasure protocol has risen 177% to date.
However, since venture firms usually enter positions before a public announcement, it’s highly likely that Placeholder and Paradigm have made considerably more, potentially upwards of 300% (return with a Feb 21st allocation). If either firm entered on January 21st, they would have returned 488%.
NMR reached a year-to-date (YTD) high of $35 per token the month after Placeholder released its Erasure Thesis for investing in the Erasure protocol. The native token, NMR is used as collateral on Erasure Bay and Erasure Quant and were both developed by Numerai. Since the YTD high, Numerai sold another $3 million worth of NMR tokens to Union Square Ventures with participation from Placeholder, Coinfund, Dragonfly Capital, and a few others.
Over the same time period, ether, Ethereum’s native cryptocurrency has risen 74% which Placeholder has been an outspoken supporter of over other smart contract competitors. Interestingly, numeraire did not benefit from the recent Coinbase announcement stating the exchange is exploring 18 new tokens, one of which was NMR. While there's no guarantee that Numerai or Erasure are successful in the long run, the protocol's token is experiencing a successful rebound from the lows of the 2018 bear market.
Why it matters:
- Venture capital cryptoasset investing is unique in the sense that companies or protocols with tokens are much more liquid than traditional startups. This means that pricing is more dynamic and can be evaluated on an ongoing basis.
- In venture capital, past performance is indicative of future results which means it’s important to watch how firms are doing and provides potential LPs a track record that can be followed in real-time.