Anais Rachel: Analyst of the Month

Welcome to the 20th edition of the Analyst of the Month

Our mission at Artemis is to help shape crypto into a more fundamentals-driven asset class by building THE on-chain metrics with leading analysts and protocols.

Every month, we highlight a leading analyst who takes a long-term view of crypto.

This month we high Anais Rachel, Research Analyst at Digital Asset Management, a division of Investments, that offers institutional-grade investment products and services for digital assets.

Anais brings a global perspective and deep expertise in crypto infrastructure from her background in economics, impacting investing, and roles at the U.S. Department of Commerce, Autonomous Partners, Bitwise, and now Digital Asset Management. Her research spans investment memos, valuation frameworks, and ecosystem analysis - particularly focused on infrastructure like blockchains, oracles and interoperability protocols. We have enjoyed following her insights on emerging trends like modular blockchains, DePIN, and unchain social networks as well as her thoughtful perspective on the evolving role of fundaments in crypto markets.

Read on to learn more about her mission to democratize access to digital assets, her insights on the future of modular blockchain infrastructure and why she believes the industry must build more relatable use cases, beyond DeFi to unlock mainstream adoption.

What is your story? What was your journey into investing and into crypto?

My journey into crypto began with a foundation in economics and an early career in impact investing. Growing up between the U.S. and France exposed me to diverse economic systems, which sparked my interest in pursuing a degree in economics at the University of Michigan. About a year after graduating, I joined the U.S. Department of Commerce, where I helped facilitate foreign direct investments into the U.S. to drive job and economic growth across various industries.

Many of the international companies with which we were working had their primary operations in emerging markets. At the time, my exposure had been limited to European and North American markets, so I decided I’d spend four months exploring South and Southeast Asia to gain firsthand exposure to some of the most important emerging economies.

I made my way back to the U.S. upon receiving an oIer to join a fund of funds focusing on impact investing in emerging markets. As I continued pursuing opportunities in that field, I gravitated towards FinTech, particularly banking the unbanked, which crypto is well positioned to do.

That interest eventually led me to join Autonomous Partners, a crypto VC and hedge fund. I spent over two years there diving into various projects, notably within the realm of infrastructure, which became my coverage area when I joined Bitwise Asset Management and is still largely my focus at Digital Asset Management.

What is the focus of the Digital Asset Management team, and what does your role on the crypto research team looks like?

The Digital Asset Management Research team examines crypto projects as both technological innovations and potential investments through their native currencies and tokens. My role within the crypto research team is multifaceted, encompassing three key areas:

1. Investment Memos and Insights: I produce investment memos that evaluate blockchains, notably their infrastructure capabilities, token economics, and ecosystem health. These insights enable informed decision-making and strategic comparisons across protocols.

2. Coverage Universe Management: I maintain a comprehensive coverage universe of infrastructure-related crypto projects (i.e., blockchains, oracle networks, and interoperability protocols), and actively engage with stakeholders to assess their capabilities, traction, and roadmaps.

3. Investment Strategies and Risk Models: I construct valuation frameworks and risk models to assess the native assets associated to my coverage universe, combining quantitative analysis with qualitative insights. These models directly inform portfolio strategies and asset allocation decisions.

This research plays a pivotal role in advancing our on-chain financial products, centered around tokenization, as well as our oI-chain financial oIerings, which consist of commingled investment solutions tailored for traditional investors. By combining rigorous analysis with a forward-looking perspective, we aim to provide valuable insights that drive innovation in both our investment strategies and product oIerings.

What do you think about the future of blockchain infrastructure?

The blockchain industry is witnessing a convergence towards a "network of networks" design, with both monolithic and modular blockchains adopting this approach to enhance scalability and customization.

Early adopters like Cosmos, Polkadot, and Avalanche pioneered this concept with their respective implementations: Cosmos with appchains, Polkadot with parachains, and Avalanche with layer 1s (previously called subnets). These systems allow for greater scalability and customization within their ecosystems.

Ethereum has evolved beyond its monolithic origins by embracing a modular approach through Layer 2s. These scaling solutions have matured into thriving ecosystems, offering more than just improved scalability. Developers can now deploy customizable rollups considering they provide unique features and optimizations.

Even monolithic blockchains that are highly scalable are considering the network of networks design given the customizability benefits. For example, Solana has introduced Solana Permissioned Environments (SPEs), which allow organizations to establish private or semi-private Solana-based networks, oIering full control over participants, infrastructure, and consensus mechanisms. As crypto adoption increases, SPEs may become more popular, especially for enterprise use cases.

Besides regulation, what do you think is currently blocking the adoption of crypto by everyday people?

In my view, one of the largest barriers to crypto adoption is the fact that the most accessible and relevant use-cases are still under development. While DeFi remains prominent, its complexities may not resonate with average users. The industry needs to expand beyond financial applications to create more relatable experiences.

The gaming sector shows promise, with high-quality blockchain-based games emerging that leverage NFTs for in-game assets and token-based economies. Intellectual property management is another area of innovation considering blockchain technology enables the tokenization and management of IP in creative industries. Onchain social networks also offer significant potential but face notable challenges, as several projects have highlighted the diffculty of sustaining long-term user engagement. This emphasizes the critical need for more sustainable and compelling social platform designs.

Decentralized Physical Infrastructure Networks (DePIN) represent a transformative approach to bridging the physical and digital worlds by bringing oI-chain data on-chain. These networks leverage blockchain technology to create decentralized systems for managing real-world infrastructure, where participants contribute data and are rewarded with tokens.

As these sectors continue to evolve and mature, they have the potential to make blockchain technology more appealing and useful to everyday users, potentially accelerating mainstream adoption.

How much do fundamentals actually matter in crypto markets today? How do you think this will change in the next 5 years? 

In today's crypto markets, fundamentals play a nuanced role, influenced by the asset’s maturity and the broader macroeconomic environment. While fundamentals like network activity, adoption rates, and monetary inflation metrics are essential to valuation models, price movements are often driven by a dynamic interplay between these fundamentals and macroeconomic factors or speculative sentiment, with each taking precedence at different times. For example, crypto markets are traded 24/7, allowing investors to capture real-time risk, which introduces both market-wide and idiosyncratic risks that can overshadow fundamental analysis.

The definition of "fundamentals" in crypto is still evolving. Metrics such as application-generated fees and the fees earned by the underlying blockchains, active addresses, net monetary inflation (determined by a blockchain’s security budget or issuance, which reflects the compensation paid to validators for securing the network), and the total value bridged in and out of each ecosystem collectively oIer one of several frameworks forassessing the intrinsic value of blockchain assets. However, these metrics are not yet universally applied or fully integrated into valuation models. As the asset class matures and institutional adoption grows, fundamentals are likely to play a more prominent role in shaping market behavior.

Investors are beginning to view crypto not only as an asset class but also as a transformative technology. Over the next five years, as understanding deepens and valuation methodologies improve, crypto markets may begin to resemble traditionalfinancial markets where fundamentals exert stronger influence.

That said, the diversity of the crypto landscape—including NFTs, decentralized physical infrastructure networks (DePIN), and blockchain currencies—means this transition will vary across sectors. Some areas may see fundamentals take precedence sooner than others, but as confidence in the ecosystem grows and valuation frameworks evolve, the importance of fundamentals in crypto markets is expected to increase gradually but significantly.

How to get in contact with Anais?

You can find or reach out to Anais on LinkedIn or Twitter and learn more about Digital Asset Management.

Artemis Disclaimer: The authors, affiliates, or stakeholders of Artemis may hold interests in the tokens or protocols mentioned in this content. This disclosure highlights potential conflicts of interest and is not an endorsement to buy or invest in any specific token or protocol. The content is for educational and informational purposes only and should not be construed as investment advice in any form.

Readers should approach this information cautiously and consider their unique circumstances before making investment decisions. The views and opinions expressed are subject to change without notice, and Artemis bears no liability for any loss or damage arising from the use of this information.