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The State of Crypto Funds
Discover the current state of crypto funds, including trends, strategies, and projections for high returns.
- The speaker defines “maxi” as investing only in Bitcoin and believes it is the only asset in the space that has proved itself, with utility and adoption across the world.
- The halving of Bitcoin is expected to happen in April and can drive the bull cycle, making it a driver of the market.
- The speaker thinks that Bitcoin’s price is undervalued, stating that a 40% valuation of gold is a conservative view of where Bitcoin should be at this point in time.
- The speaker believes that the alpha in crypto comes from volatility and high volume, making it an attractive space for hedge funds.
- The fund being discussed is a fund of crypto hedge funds, with an average basis of around 30,000 for this cycle.
- The speaker thinks that the fund’s strategy is a combination of market mutuality, general arbitrage, and mean reversion strategies.
- The halving of Bitcoin will lead to a natural selection of miners, with those who cannot operate at a high level going out of business.
- The speaker thinks that the fund’s strategy of aggregating risk across multiple funds and managers provides a nice edge in constructing the portfolio.
- The fund’s returns are expected to be high, with a prediction of north of 35% in a bull market.
- The speaker believes that the growth of the crypto space is driven by the increasing adoption of decentralized finance (DeFi) and non-fungible tokens (NFTs).
- The speaker thinks that the fund’s ability to negotiate with managers and get good terms for investors gives them an edge in the market.
- The fund’s IRR is expected to be around 25% and is considered very attractive for institutional investors.
- The speaker believes that the fund’s strategy of aggregating risk across multiple funds and managers provides a nice edge in constructing the portfolio.