Crypto
The Block: Crypto Hedge Fund Launches Actively Managed Ether And Bitcoin Trusts September 23, 2021
September 2021 - Crypto
A crypto investment firm is launching two new products that aim to offer accredited investors the opportunity to add crypto exposure with less of the market's breakneck volatility.
Cambrian Asset Management, a California-based investment firm with more than $200 million in assets under its management, announced this week its so-called Cambrian Bitcoin Systematic Trust and Cambrian Ethereum Systematic Trust products. Unlike existing products, like Grayscale's Bitcoin Trust, Cambrian's new funds plan to manage down risk in bitcoin and ether's price in addition to offer exposure.
“We are excited to offer a new way of investing in digital assets through the launch of these new Trusts,” said Martin Green, Co-CIO and CEO of Cambrian. “Investors have asked us many times if they can use our systems to actively manage their Bitcoin or Ethereum exposure to protect against the material drawdowns that are endemic to digital assets markets."
Green's Cambrian has been leveraging so-called quantitative trading strategies and more than 100 billion market data points to return an outsized return to investors. As reported by Bloomberg, the fund returned 76% for its investors from the beginning of 2021 through the end of August. Bitcoin, meanwhile, has returned 62%. At the same time, the fund has suppressed "downside volatility by greater than 70%," a press release notes.
That could be a welcomed feature for investors looking for exposure to a market that frequently sees cascading liquidations trigger more than 50% drawdowns.
In an interview with The Block, Green said the two new trust products could serve as a foundation for further products, which could offer accredited investors exposure to a wide range of assets. Potentially, Cambrian could open those products to retail investors with the proper regulatory approvals and corporate partnerships.