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A Turbulent 2 Years – My Top 3 Learnings

by | Aug 23, 2023

I am extremely excited to share that the MTC Digital Assets Fund has recently turned 2! 🎉

Since launching the fund on the 18th of August 2021 we have experienced a very turbulent period including one of the most challenging years ever for risk-on assets. Through tough periods and when our backs are against the wall I truly believe we learn the most important lessons and that only the strongest business endure. As such, I wanted to take the opportunity to look back on what has transpired and reflect on my key learnings through this period. Here we go:

Learning 1 – Because of Ryan and my complimentary career backgrounds we took a very deliberate and conservative approach to crypto when designing our funds investment strategy. Large liquid coins only, not trading (buy and hold), not taking leverage, strong risk & portfolio management. We believe this strategy has proven successful even through the darkest of periods in the market in late 2022. We avoided all the black-swan events such as the FTX collapse, the Luna/Terra collapse and other bankruptcy events, which gave investors’ confidence in our approach, despite the overall market conditions. We believe there’s enough upside in crypto to need to go any further out the risk spectrum. While it may seem like a boring strategy to some, we know our lane and we stay in it.

Learning 2 – The establishment of a highly capable, experienced, and fully engaged advisory board has helped guide us through the market cycles and kept the team focused on the right things at the right time. During periods when the markets were most difficult, our board advised that we double-down on comms and education, one of the comments was “You can’t move the needle on the market, so focus on something that you can move the needle on”. Ensuring both existing and potential investors were kept closely informed on the asset class and the market at key points enabled them to make good decisions while having increased confidence in the team behind the fund. We were very pleased to have investment partners and family offices re-invest with us through these periods, and we will continue to double down in this area as we move forward.

Merkle Tree Capital Advisory Board, December 2022

Learning 3 – Being honest and humble at all times. We have had many investors tell us that they want to keep hearing from us even when things are bad and that they believe this is the sign of a good manager. It’s natural to try and put a positive shine on things when talking to people, however there’s nothing worse than giving people false expectations. When energy levels are flat because of market conditions, the worst thing we can do as managers is go missing, or pretend like things are fine. One of the reasons we have such strong investor retention is because we set expectations very clearly from the outset and we remain honest, real, and humble throughout the journey. This is how we live our lives and its how we want to come across as investment managers. No bull, earn and maintain trust, and cherish good relationships.

While it may not feel this way at the minute, I do believe we are fortunate to have been through this period and that the only way to truly appreciate these learnings is to experience them firsthand. I have no doubt that we have become stronger for it and that the future has never looked brighter.

I really hope you’ve enjoyed reading through my top 3 learnings and that that you’ve been able to take something from them. I would love to hear from you if any of these particularly resonate with you in some way or you have some others you would like to share.

Here’s to year 3 and beyond!