DIA, a financial data aggregator, together with Outlier Ventures, a venture platform, conducted a study analysing 42 digital asset market data vendors worldwide and their business models.
The study analyses data vendors around the globe, shedding light on a range of factors from entity types, sourcing methodologies, business and pricing models and more. The study provides a snapshot of a fast-developing market, displaying which teams take an active part in shaping the new era of financial data.
Blockchain technology has been advancing further and further over the past years, bringing new industries with it which resemble those of the institutional markets, yet differ in key-aspects. Digital assets like cryptocurrencies and security tokens gain popularity and with it grows an ecosystem around them. Daily trading volumes on digital asset exchanges by now surpass 100 billion US-Dollars.
However, there are some vital market gaps that existing solutions as well as new market entrants have not been able to fill. One of the most vital building blocks in any efficient market is the reliable access to accurate and timely data surrounding the products and their usage. Nonetheless, the existing solutions for digital assets show startling inefficiencies, as recent data glitches and accompanying financial fallout show. Many new and incumbent teams are trying to close this gap in order for data integrity to match the markets size and ambitions.
“Within newly emerging industries, achieving a reasonable level of transparency is a rare sight. This study is not only a first small step in creating a more visible, transparent and comparable market.”
Jamie Burke, CEO and Founder of Outlier Ventures explains.
“Market data like this is vital to the development of a vibrant decentralised technology ecosystem, bringing fundamental analysis to the market and creating a blue chip crypto asset class. This is why we are so happy to support DIA in their mission to make financial market data an open access resource.”
“We see Decentralized Finance, or DeFi as one of the most disruptive upcoming changes to our global financial economy, promising equal access regardless of geography or social status, censorship resistance and the disintermediation of trusted, yet expensive third parties.”
Main findings
The study analysed 42 data vendors, including start-ups and institutional companies in 17 nations around the globe. In sum, new entrants have raised funding of over 110 million US-Dollars worldwide, and revenue is estimated at 15 million US-Dollars, according to Crunchbase. Geographically, the market is developing in two regions: In the USA, 17 companies have so far emerged, while Europe has a slight edge with 19 companies in total. Overall the study uncovered a broad and fast growing ecosystem, shedding light on the dynamics and structure of the market.
The study lays a first foundation for a more extensive review of the market. In order to gauge the future development of the industry, a deeper study should at least include an analysis of the scraping methodologies, track record of accuracy and reliability as well as features and services surrounding the provision of data.
Further findings
- Data sources: Free-of-charge datasets on average offer data from more exchanges than paid services. 83% of free datasets include 100 to 400 exchanges. Partly free, partly fee-based services are balanced out evenly with 3 companies offering less than 25 exchanges, 6 offering 26 to 100 exchanges and 4 companies utilising more than 100 exchanges. Exclusively fee-based market data vendors largely employ between 8 and 25 different exchanges (60%), a way more curated approach compared to the free offerings.
- Data types: Most of the 42 data vendors we analysed focus solely on digital asset market data but not all of them. 7 companies, also offer traditional market data, of which 6 started in the institutional space and with 1 company venturing into both the digital asset and the institutional market at the same time.
- Prices: Digital asset market data can be bought for a wide variety of prices. New companies offer low-priced yet varied datasets starting as low as 10$ for a single user per month, while institutional companies stick to high and rather untransparent pricing methods, culminating in prices of up to 2250$ for a single user.
Featured image credit: Unsplash
