Introduction to the Digital Assets Landscape
The dominant cryptocurrencies, led by Bitcoin, have already demonstrated the growing importance of digitally scarce global systems that enable decentralized value storage and immutable transactions, offering diversification, inflation protection and capital appreciation potential. Furthermore, this nascent marketplace is starting to attract increased interest from traditional financial players, with Wall Street firms conducting feasibility studies, infrastructure-level investments, building custody solutions, and hiring for liquidity product offerings in anticipation of the coming wave of mainstream investment.
However, there are already over 2,000 digital assets listed on exchanges around the world, and projects differ across addressable markets, developer communities, underlying technologies, geography, and legal status, with few sources of authoritative, quality research. At the same time, actually deploying capital requires domain-specific expertise, for example in securing private keys via multisignature solutions, onboarding and integrating with exchanges directly and via API, and sourcing and vetting disparate data sources for use in investment research and risk management.
Lastly, the bulk of current asset managers in the digital asset universe specialize in illiquid, VC-style investing, while many of the popular liquid strategies are quantitative, buy-and-hold, or passive, leaving the door open for experienced fundamental long/short managers such as the strategy we are pioneering.