Dear owls,
Following our discussion with @DocHabanero there have been a few changes to the Owlbserver over the last 2 weeks :
- First of and de facto, we are now targeting bi-weekly posts to leave more time for in-depth research & analysis. We’re mindful that this may result in significantly longer posts.
- Second, we’re not going to focus exclusively on the decentralized asset management sector anymore, but will also collect as much intel from the TradFi sector as possible.
- Third, the work on a custom database to compare AUM between DeFi index protocols has been paused until we extract the most actionable insights possible from this publication.
As always, your feedback means a lot and is greatly appreciated ! 
Without fiddling around any further, let’s dive into the last 2 weeks lowdown …
TradFi insights
→ Ryan Rasmussen from Bitwise recently communicated on Twitter the results of an interesting poll that followed a DeFi presentation he did to 400 Investment Advisors : while more than 60% seem to be already involved in crypto, the poll says less than 50% have heard of DeFi and less than 20% have already used a DeFi application.
→ This comment likely comes on the back of Bitwise 2022 Benchmark Survey of RIA’s attitude towards crypto, which interestingly reveals that while 94% of advisors received questions about crypto in 2021, around 60% of them cited regulatory uncertainty and volatility as the main barriers to greater portfolio allocations.
→ In a significant ramp-up of their communication around their filling to convert $GBTC into a Bitcoin spot ETF, Grayscale have created a specific landing page to encourage public comments on their application, as per the SEC’s latest ruling on the matter.
→ Grayscale’s main arguments to convince investors of the benefits from the GBTC conversion into a spot ETF is the reduction of fees and the elimination of premium / discounts.
Investors comments ( a lot of !) can be consulted here. Here are some of the most recurrent arguments developed in favor of a BTC spot ETF :
- Avoidance of self-custody or security risks posed by traditional crypto wallets / exchanges.
- Regulatory tax compliance issues.
- Matter of national security and strategic interest.
- Innovation in financial technology.
- Fair pricing, avoidance of NAV decay.
- Allowance of exposure via retirement account.
- Avoidance of costs incurred by rolling future contracts.
→ Grayscale (again !) have produced an interesting report promoting what they call the Postmodern Portfolio Crypto Allocation - uuuhm this Post-Modern stuff strangely reminds me something 
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TL;DR :
- Compared to Internet user adoption trend, we’re still in a “1999-like” growth phase.
- Crypto market cap is already big enough to justify inclusion in institutional portfolios, but still has huge upside potential in the coming 5 to 25 years.
- The past and projected risk-adjusted returns of crypto assets make them a key component of an inflation-beating, diversified portfolio in the current macro-environment.
DeFi news
→ Domani DAO have passed the proposal to launch an Avalanche Blue Chip Index. The product is capitalization weighted, with a broad exposure to the wider AVAX ecosystem (proposed composition notably less restrictive than Cook Finance’s equivalent product).
→ Indexed Finance have also launched a new product in the form of an alternative Layer 1 index comprising native $SOL, $LUNA, $AVAX, $ONE & $FTM tokens bridged over to Polygon.
→ Scalara (DeFi Pulse) 's NFT index $NFTI is live on Polygon and Arbitrum since March 1st. While the aggregated market cap at the time of writing sits around 855k$ (555k$ on Polygon & 300k$ on Arbitrum), there are in total 24 holding addresses for the product.
→ The Galleon DAO / Beverage Finance partnership has launched $ETHMAXY, the Ethereum Max Yield Index providing 3x leveraged exposition to staked Ethereum with $DLB and $DRINK rewards on top of the staking yield. TVL has just increased over 500k$ at the time of writing.
Parting thoughts
One thing that stood out when I started comparing the DeFi and TradFi approach around investors communication is the focus that our off-chain competitors put on macro-environment and societal developments, while the DeFi sector is still strongly focused on highly technical details. Food for thoughts !