Despite a few ‘Ponzi schemes’, this fundie thinks crypto will bounce back stronger | domp
, which aims to examine, challenge and demystify the ideas behind the emerging industry by speaking to the people who live and breathe it.So, the fund is a global equities fund focused on innovation, and that includes the Web3 space and digital assets. And it came about from looking at where the world was going - I started out as a value investor, and over time I could clearly see that all my technology-enabled investments were doing the best.
Obviously, it’s down, and this is why the allocation is small. But we’re thinking about things on a five to seven-year timeframe, and while this current downdraft provides some headwinds to the portfolio, for me, it’s actually quite good in terms of cleaning out a lot of the bad stuff in the space.And what the regulators are trying to put in place, in terms of clear frameworks and legislation, is to avoid this.
Exactly. And people don’t realise the regulatory burden on funds like ours, we’re constantly running liquidity tests with our funds - it is a very thorough process. So, as soon as you see these very high-yield products, you have to ask how sustainable they are? How are they being generated? What’s the economic proposition?And when you start to look at it more and more, it looks like a Ponzi scheme. With the way it’s actually structured, there’s nothing real there.
I think the main thing that will happen though, this will really make legislators globally realise that they do need to put in place some clear laws and clear regulations that bring risk management into the fray. I think that’s the single biggest thing I see as a clear outcome of this cycle.Holon portfolio manager Heath Behncke
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