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This crypto fund has outperformed bitcoin for the last five years. Here’s how

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This is a visual representation of Bitcoin.

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A blockchain fund managed by value managers believes it can offer investors higher returns than Bitcoin in a market crowded with traders and venture investors.

BitcoinThe best-performing asset for the decade by some. Off the Chain Capital, a fund that deploys a traditional value investing strategy – using fundamental analysis to find undervalued assets – says its fund has outperformed bitcoin in each of the last five years.

According to Off The Chain, the fund averaged 133% annually since it was established in 2016. This compares to an average of 108% for bitcoin. For both bitcoin and the fund, the firm calculated the compound annual growth rates using the Dec. 31, 2016, and Feb. 28, 2022 as the beginning and end dates.

Brian Estes is the chief investment officer and CEO of the fund. “We have outperformed Bitcoin five times out of five years and with 80% less volatility” he said. This is what I am most proud of. I created this fund so that foundations, endowments and conservative investors could have exposure to the blockchain assets. They also get downside protection.

It also said it has outperformed the S&P 500 by 3,653% in the same period, and is 99.99% uncorrelated to the broad market index, meaning the two do not move up and down in tandem.

You are searching for value

Fund’s strategy is finding mispriced assets within the Blockchain space.

The company aims to purchase one dollar worth of crypto assets at 50c and earn returns. It will not buy them at fair value but let them grow. It can use a value-based approach to capture the industry’s growth while also capturing it.

Off the Chain bought large amounts of Mike Novogratz’s shares, as an example. Galaxy DigitalEstes claimed that it was about 70c back two years ago. Stock closed at $15.79 per share on Tuesday.

Silvergate BankEstes also believes that another company is being underpriced. This crypto-friendly bank became public in 2012 and was initially valued as a banking institution, even though it is a company that operates more like a blockchain.

It was valued at 8x earnings and 3x book value. What people did not understand was that Silvergate isn’t a bank. Instead, it is a cryptocurrency company with a virtual monopoly over most crypto companies.

He added that the company’s earnings have increased by more than 100 percent per year.

About half the portfolio is made up of private equity. Additionally, the firm looks to find mispriced digital assets such as bitcoin.

Providing diversification

Off the Chain, one of the top buyers of Mt. Gox bankruptcy claims Mt. Gox was once the largest custodian of bitcoin until a Russian hacker stole nearly all of it — about 740,000 bitcoins then worth $460 million.

Estes explained that people can buy these claims from the fund at a discounted average of about 80%.

We believe that bitcoin is the best store of value. It is an important diversification tool for portfolio managers. Purcell stated that bitcoin can outperform any fund.

Binance, and BNB (its utility token) are also considered undervalued assets.

It is valued at the current time as CoinbasePurcell spoke highly of Coinbase’s exchange. “It trades approximately 4.2 times as much,” Purcell explained. They’ve also created the Binance Smart Chain which takes developers from other communities like Ethereum. We believe this is a play for value.

The fund has approximately 200 limited partners, and has $399 million in under-management. For a minimum $1 million, it targets families, endowments and high net-worth individuals.

Estes indicated that there is currently a $200 million in the fund. The fund is also expected to launch a bitcoin AI algorithmic trading platform in the next six-months.

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