The aim of the MHC Digital Asset Fund is to provide investors with a secure, broad macro exposure to the crypto currency ecosystem. Our stated aim is to capture 80% of the upside in the crypto market while insulating investors from 40% of the downside. In a highly volatile market, we believe this strategy provides investors with a portfolio that will outperform the market in the long run, while reducing the volatility of an investment.
This balance of investments (as outlined below) replicates a traditional finance portfolio by diversifying across large cap investments, fixed income, such as arbitrage investments, and venture capital plays. We believe that we can outperform the market as a whole with such a diversified strategy which has performed as expected for over a year with our personal money and is now available to external investors.
To achieve this outcome, our investment portfolio is segregated into three buckets with flexibility to allocate between those buckets
depending on market conditions.
The Fund invests up to 75% of the portfolio in a wide range of coins with a market cap greater than USD$1bn, including Bitcoin and Ethereum.
This gives the portfolio diversified beta exposure to the cryptocurrency market through actively managed coin allocations.
These holdings can also be used for staking activities to increase returns.
Stablecoin Staking and Yield Farming: A variable stablecoin holding insulates from market volatility while also generating significant returns through staking, lending and liquidity provision.
Market Neutral Trading: Market neutral trading strategies use a variety of derivative products to profit from both increasing and decreasing market movements, providing a low-beta exposure in the Fund.
Through its position in the market, the Fund can offer investors unique access to early-stage investments in cryptocurrency and blockchain opportunities that we believe have the potential to produce significant returns.
As part of its allocation to early investment opportunities, the Fund recently participated in Crypto Gaming United's ("CGU") oversubscribed seed round. CGU is building a global gaming guild providing real income possibilities to the most remote parts of the world through play-to-earn gaming.