Block by Block: Vijay Pravin of bitsCrunch

👾 A decentralized crypto forensics and analytics solution.

Marco Manoppo
March 03, 2024

📢 Sponsor | 💡 Telegram | 📰 Past Editions

Happy Sunday. Welcome to another issue of Block by Block, a series where we highlight conversations with founders and operators. The idea is to ask thoughtful questions for projects that want to achieve more media exposure.

In today’s issue we have Vijay Pravin from bitsCrunch — a crypto data analytics and forensics company that has raised $12M from the likes of Coinbase Ventures and Animoca Brands.

Crypto data is open source. But as the number of chains launched (and the TPS) increase, so does the complexity in wrangling through all the data. The industry needs a decentralized and open source way to tackle this problem. Enter bitsCrunch.

To learn more about bitsCrunch and the solutions that they offer, check out my conversation with Vijay Pravin, Founder and CEO of bitsCrunch.

-Marco

P.S. Don’t be like this 👇

Disclosures

Today’s issue is sponsored by bitsCrunch.
None of this is investment advice.
Founders of Launchy hold no exposure in bitsCrunch.

Vijay Pravin of bitsCrunch

Vijay Pravin is the Founder and CEO of bitsCrunch, a leading global data analytics and forensics company specializing in multi-chain insights for NFTs and digital assets. bitsCrunch is focusing mainly on building products using Artificial intelligence for the crypto space.

Before founding bitsCrunch, Vijay worked as a Data Scientist at Telefónica and Volkswagen Germany. From 2018 to 2021, he served as an Analytics Solutions Expert at Siemens. In May 2020, he founded bitsCrunch in India, and a year later, bitsCrunch established its entity in Germany.

Vijay earned his Bachelor of Engineering in Electronics and Instrumentation Engineering from Anna University Chennai and his Master’s degree in Electronics, and Communications Engineering from Technical University of Munich, Germany.

From 2020 to 2021 Vijay served as Ambassador at DeepLearning.AI. He was also the first Indian to be invited for a TEDx talk in Germany below 30.

Here’s my conversation with Vijay Pravin.

Quick takeaways:

bitsCrunch is a data analytics and forensics company specializing in insights for NFTs and digital assets.
bitsCrunch aims to be the leading forensics player in the market, offering transparency and real-time operations insights in alignment with Web3 principles, differentiating itself from other analytics firms by not operating on centralized platforms.
Future plans include expanding to index non-EVM chains like Solana, covering over 90% of the digital asset volume, and focusing on decentralization to foster a cooperative blockchain ecosystem.
The bitsCrunch token ($BCUT) plays a central role in the ecosystem, facilitating decentralization and community engagement through various roles such as node operators and contributors.
Vijay sees NFTs as a permanent fixture in the digital landscape, with potential growth in web3 gaming and broader utilities beyond art and profile pictures, aiming to position bitsCrunch as the TradingView for the web3 space

The following paragraphs are not verbatim quotes. These are paraphrases of our conversations optimized for written media formats. Some context and nuances might not have been conveyed properly in the process.

The author of this issue is not responsible for any misconstrued statements made in the issue.

All information presented in this publication and its affiliates is strictly for educational purposes only. It should not be construed or taken as financial, legal, investment, or any other form of advice.

What was the defining moment that drew you into the world of crypto?

Vijay's journey into the world of crypto began during his master's studies in Germany, where his initial interaction with cryptocurrency was merely as an early investor in Bitcoin and Ethereum around 2015 or 2016. Despite experiencing both gains and losses, Vijay maintained a keen interest in the space, not as a developer or founder, but as an observant onlooker.

The turning point came during his tenure at Siemens when the pandemic hit.

Living in Munich, close to Italy, Vijay faced strict lockdown measures that confined him and his future co-founder to their homes. This period of isolation sparked their creativity, leading them to participate in virtual hackathons and ETH global events, marking their initial steps towards entrepreneurship and development within the blockchain domain.

With a background as a data scientist at Siemens and Volkswagen, two pioneers in the Web2 sector in Germany, Vijay had already established himself as a leading data professional. Recognized as one of the top 20 data scientists to follow on LinkedIn and among the top 40 under 40 data scientists from India, he had a profound expertise in data analytics and forensics.

The defining moment: Vijay's deep dive into the NFT world was catalysed by the sale of Beeple's $69M NFT, purchased by Vignesh Sundaresan, also known as MetaKovan, who coincidentally hailed from Vijay's hometown in India.

This event challenged Vijay's perception of NFTs and propelled him to explore the realm further, particularly focusing on the forensic aspects of NFT transactions, akin to performing chain analysis for NFTs.

Seeking to illuminate the darker sides of the NFT market, Vijay and his team embarked on a mission to understand and mitigate potential downsides.

This journey has led to significant achievements, with Vijay's venture, bitsCrunch, raising over $12M from prestigious investors like Coinbase Ventures, Animoca Brands, Polygon, Chainlink, Hashkey, Gate Labs, and Crypto(.)com, among others.

The launch of bitsCrunch tokens ($BCUT) across seven exchanges on the first day, including Bybit, Kucoin, Gate, Coinlist, Crypto(.)com and Uniswap, marked a significant milestone. Currently, the venture is thriving, with a market consolidation around the $300-350M mark, a testament to their success in the blockchain and NFT space.

What is bitsCrunch?

bitsCrunch started from the NFT space but has evolved beyond the NFT space, now indexing ERC20 tokens and providing historical prices for over 200,000 tokens on Ethereum.

For example, if you need the price of Chainlink from December 2018, bitsCrunch has this information readily available. The aim is to become the leading forensics player in the market.

Unlike existing forensics and data analytics firms like Chainanalysis, Elliptic, Dune, Nansen, or Messari, which might operate on centralized platforms, bitsCrunch is committed to transparency and operates in alignment with Web3 principles. This approach allows users to see detailed operations, including transactions and revenue, in real time without waiting for published reports.

To illustrate the platform's capabilities and user engagement, Vijay highlights that in the testnet phase alone, users made half a billion data queries. Since launching on the mainnet just a week ago, there have already been more than 200,000 data queries, with almost half a million bitsCrunch tokens being staked.

This shows a rapidly growing interest in the ecosystem, laying a solid foundation for bitsCrunch's future. While acknowledging that building a robust platform like Rome won't happen overnight, Vijay is optimistic about bitsCrunch's journey, starting on a positive note and aiming for long-term success in the industry.

What products or use cases does bitsCrunch currently offer for users to try?

One of bitsCrunch flagship product suites is designed to safeguard the intellectual property (IP) of brands within the digital domain.

For instance, should the brand assets of companies like McDonald's or KFC be misappropriated in the NFT space, bitsCrunch has the capability to intervene and protect these assets.

This protection extends beyond on-chain data, encompassing images or NFTs stored on decentralized platforms like IPFS or centralized services such as Google or Amazon, where metadata and images are often housed. By indexing the collections of these brands, bitsCrunch provides periodic alerts to notify them if their assets are being duplicated by malicious entities in the market.
A notable case from 2022 and 2023 involved the MetaBirkins NFT collection, which replicated designs from the luxury brand Hermes, selling for significant amounts. This constituted a clear infringement of Hermes's IP, leading to legal action and a court victory for the brand.

This instance underscores the widespread potential for IP infringement across numerous brands and the ease with which blockchain technology can be exploited for such purposes, given its lack of native capability to authenticate the originality of images or metadata.

In collaboration with MasterCard, bitsCrunch was selected for the Mastercard Start Path Blockchain And Digital Assets program of 2022, working on a security layer for transactions. This partnership aimed to integrate a safety mechanism for NFT purchases made through MasterCard, offering a verification layer to alert users about the authenticity and legitimacy of the NFTs they intend to buy. This initiative, although currently on hold due to market conditions, represents a significant step towards secure, card-based NFT transactions, signaling potential future expansions in payment options for NFT marketplaces.

Additionally, bitsCrunch offers Wash Trading Insights, leveraging artificial intelligence (AI) to identify and analyze suspicious trading activities. This tool is not just about detecting wash trades—where individuals or groups trade assets among themselves to create misleading market activity—but also extends to identifying patterns indicative of money laundering.

By scrutinizing transactions to and from OFAC-listed wallets and tracing the flow of funds through multiple layers, bitsCrunch plays a crucial role in detecting illegal financial flows in the NFT space.

In essence, bitsCrunch positions itself as the NFT ecosystem's guardian, employing advanced technologies and partnerships to ensure the integrity and security of digital assets and transactions.

bitsCrunch also just released a B2C version of bitsCrunch called https://unleashnfts.com/ that is currently free of cost until sometime later this year.

How does bitsCrunch position itself in relation to companies like Chainalysis and The Graph?

Vijay describes bitsCrunch as essentially a decentralized Chainalysis, emphasizing the ease and accessibility of data for anyone, anywhere in the world, without the need for expensive subscriptions or complex negotiations. This approach democratizes access to blockchain data, making it available to a broader range of users with just a few clicks.

From a decentralization standpoint, bitsCrunch aligns with The Graph in terms of enabling data accessibility. However, bitsCrunch distinguishes itself by offering a unified API that simplifies user interaction with blockchain data, as opposed to The Graph's model of creating specific subgraphs for each protocol.

This technical advantage positions bitsCrunch as a more versatile and user-friendly platform, combining the best aspects of both Chainalysis and The Graph by merging comprehensive blockchain analytics with a decentralized and accessible framework.

Can you explain how your recently launched token ($BCUT) integrates with bitsCrunch's services?

The bitsCrunch token, denoted as $BCUT, is central to bitsCrunch's ecosystem, emphasizing its utility from day one without overly focusing on the term "utility" to navigate the initial stages of bitsCrunch's journey without regulatory concerns. bitsCrunch envisions evolving the token's branding to more explicitly highlight its utility as the community recognizes its value.

Currently, bitsCrunch is supported by approximately 50 node operators who play a crucial role in decentralizing bitsCrunch's API layer. This system underpins bitsCrunch's services, such as those accessed via https://unleashnfts.com/, where API calls are distributed among these operators. This strategy marks bitsCrunch's transition away from traditional cloud services like GCP and AWS towards a fully decentralized infrastructure.

These node operators stake $BCUT tokens to manage nodes, contributing to the network's security, handling API queries, and ensuring overall availability. Additionally, members of the broader community can delegate their tokens to these operators, further integrating themselves into the bitsCrunch ecosystem.

Beyond node operation, the $BCUT token facilitates community engagement through roles like contributors, who are incentivized to assist bitsCrunch. Whether through coding, social media engagement, blogging, or other forms of contribution, community members play a pivotal role in guiding bitsCrunch's decisions, such as identifying assets associated with wash trading or money laundering.

Another innovative use of $BCUT tokens is through the "indicator" role, allowing the community to influence the direction of bitsCrunch's development, including deciding which blockchain networks to index next. Currently, bitsCrunch indexes Ethereum, Polygon, Avalanche, and Binance Smart Chain, with the community's input guiding future expansions.

In summary, the $BCUT token is designed to foster a decentralized, community-driven ecosystem, enabling contributions that range from operational support to strategic decision-making, illustrating bitsCrunch's commitment to decentralization and community empowerment.

What future features or focuses does bitsCrunch have planned for the next few quarters?

bitsCrunch is on the verge of a significant expansion with the integration of Solana, marking its venture into the non-EVM domain. Until now, bitsCrunch has been recognized for its prowess in indexing EVM chains such as Ethereum, Polygon, Avalanche, and Binance.

The frequent inquiry about when bitsCrunch would embrace a non-EVM chain is addressed with its move towards Solana, especially given its dominance in the NFT space. This expansion into indexing Solana opens up bitsCrunch analytics and forensics capabilities to non-EVM chains and significantly broadens its ecosystem. With Solana's inclusion, bitsCrunch is set to cover over 90% of the digital asset volume in the space.

Furthermore, we are keenly observing emerging trends like BRC20 tokens, Ordinals, and inscriptions, recognizing their growing importance.

On the NFT front, bitsCrunch is not just expanding its chain coverage but also enhancing its service offerings to include token information indexing. This positions us as a decentralized counterpart to Chainalysis in the broader token space, differentiating bitsCrunch further from other platforms. Unlike The Graph, which focuses solely on on-chain analytics and metrics, bitsCrunch incorporates AI and data analytics for forensic analysis, delving deeper than standard data analytics and reporting.

bitsCrunch decentralized nature offers the unique advantage of collaborative growth, where developers can build upon bitsCrunch's platform and vice versa. A testament to this collaborative ecosystem is bitsCrunch partnership with DappRadar, who, despite seeming like a potential competitor, utilizes bitsCrunch for AI-powered NFT price estimations. This collaboration underscores the value of decentralization and permissionless innovation, setting a precedent for other platforms like The Graph, Dune, and Nansen to engage in mutually beneficial developments with bitsCrunch.

bitsCrunch focus on decentralization not only differentiates itself but also fosters a more interconnected and cooperative blockchain ecosystem.

What are your thoughts on the future of NFTs and what developments in the NFT and broader digital data landscape are you looking forward to this year?

Vijay believes NFTs, having experienced just one real bull market, are here to stay, highlighted by major brands like Visa, Nike, Adidas, Reddit, and Starbucks embracing the NFT space.

He sees the future of NFTs extending beyond just art or profile pictures, particularly with the anticipated integration into web3 gaming. This evolution will broaden NFT utilities, especially in popular games. bitsCrunch aims to support this growth by providing deep NFT and gaming insights, positioning itself as the TradingView for the web3 space, and offering valuable data, insights, dashboards, and forensic analysis.

If you enjoy reading this issue, please consider subscribing. It takes 1 minute of your time but it would mean the world to us 🙇

Disclaimer: All the information presented in this publication and its affiliates is strictly for educational purposes only. It should not be construed or taken as financial, legal, investment, or any other form of advice.