If in doubt, ask the managers

If in doubt, ask the managers

In a response to recent market moves, we conducted an interview with three of our managers with the longest track records. Meet Aljoscha Frick (Germany), Menno Pietersen (the Netherlands), and Victor Lai (Hong Kong). We asked them all the heavy questions about the market and put them in a context so you get three different perspectives from people who have seen it all.

What in your opinion was the trigger of the current crypto optimism? Monetary action of central banks, strong development within the industry, or the mass adoption that we are seeing right now?

Aljoscha

There are several things that have had and will have a huge impact. One is the monetary action by central banks printing huge amounts of new money. This causes inflation, so people will automatically be drawn into crypto to protect their capital from being diluted. On the other hand, we have the adoption side, like PayPal implementing Bitcoin, and soon other cryptos as well as the disruption by DeFi in the legacy markets. Lots of things are pointing towards crypto being a very good (the best) bet for the future.

Menno

I think it is a mix of all of it . . . . We live in a crazy time of uncertainty, panic, and a global crisis. Add to this: negative interest rates for saving, stock markets at ATH, and overpriced housing markets. Insane amounts of capital are simply created now, and the fact is all that money has to flow somewhere! And crypto is still tiny, even a little % of all that new money will make the markets move up a huge amount. But Blockchain, Crypto has grown up a lot, new technologies and ideas are forming, DeFi, DPOS new DAO structures . . . it's all very exciting.

Victor

I would say there are many factors:

  • Central banks printing money is inflating asset prices everywhere.
  • The innovative projects with the great product-market fit (i.e., the DeFi sector) are attracting the attention of the market.
  • The stock market is close to all-time-high levels, but the cryptocurrency market is still well below its peak.
  • Gold, a store of value often compared to Bitcoin, is making all-time-high.
  • The inflow of fiat into the crypto space as seen by the surge in stable coin market cap.
  • With so many positive catalysts brewing, I believe we are still early in the bull cycle and Bitcoin can break the previous all-time-high.

Has the crypto thesis changed with the last bear market? Is Bitcoin still the king?

Aljoscha

No, Bitcoin is still King. At least for now. But Ethereum activity is very promising.

Menno

Bitcoin is the king of Digital Gold, a SoV . . . Absolutely NOT as a technology or crypto investment during bullish times. CARUS-AR is outperforming BTC by a huge margin and currently, we hold 0% BTC.

Victor

I would say the crypto thesis hasn’t really changed. During a bear market, investors de-risk and shift to safer holdings. Therefore, Bitcoin dominance rose dramatically in the past two years.

I believe Bitcoin is still the benchmark of the cryptocurrency market. When investors look to purchase any coins other than Bitcoin, they should have an expectation that it would outperform Bitcoin, otherwise, it doesn't make sense to invest in it.

What is your strategy currently reflecting? Any specific bets?

Aljoscha

DeFi is the biggest bet out there at the moment. Which only makes sense to me. The system used by the legacy markets is like a stone age compared to what crypto (DeFi) is capable of. What Uber did to taxi drivers, DeFi will do to legacy market systems.

Menno

The bull is here, diversify, take profits on the way up and focus on DeFi, DAO, Platforms, Interconnect-ability & scaling.

Victor

The cryptocurrency market is the fastest-changing financial market that I've seen. One has to be very adaptable and nimble in order to ride the trends.

Since the market is still highly speculative, the market can be very emotional and fundamentals can sometimes be thrown out of the window. Investors need to be very in-tune with the market to capture as many opportunities as possible.

Are your non-crypto friends already asking for your advice?

Aljoscha

Friends yes, they always have. But acquaintances, no!

Menno

They never stopped, but the bull is absolutely back and random people are starting to ask about that crypto thing again . . . .

Victor

Not at all.

While a lot of smaller coins recently had a big runup in price, those who do not pay as much attention to the market still see bitcoin and ether well below the all-time-high. I believe the masses won't get into the market until all-time-highs are broken.

Links to each Crypto Strategy:

Aljoscha Frick
https://www.iconomi.com/asset/FCI

Menno Pietersen
https://www.iconomi.com/asset/CAR

Victor Lai
https://www.iconomi.com/asset/CCC

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