Polychain’s asset management scale has almost halved, and it had previously bet on Ethereum
Polychain, a cryptocurrency fund that once managed $1 billion, has seen its assets under management shrink a lot.
According to a Polychain filing with the U.S. Securities and Exchange Commission (SEC),new fileThe Wall Street Journal
The Wall Street JournalCiting people familiar with the matter, the shrinking of Polychain’s assets under management is mainly due to the decline in the price of the assets it holds, rather than redemption by investors. About a third of Polychain’s main fund is invested in ethereum, The Wall Street Journal reported last year. However, Ethereum's token ETH has fallen by nearly 80% compared to its peak in 2018.
Polychain is one of the elite funds servicing startups in the crypto industry. In 2016, former Coinbase employee Olaf Carlson-Wee founded Polychain, the first fund to invest in tokens rather than companies. In December 2016, Polychain Capital received $10 million in financing from investors including venture capital firm Andreessen Horowitz (A16z), Boost VC and Union Square Ventures (USV, Union Square Ventures).
With the rapid growth of the cryptocurrency market in 2017, on the one hand, Polychain obtained multiple returns from its early investment projects, and on the other hand, it also gained the attention of well-known capital, including Sequoia Capital, Bain Capital Ventures And Peter Thiel's Founders Fund, as well as Silicon Valley heavyweight Andreessen Horowitz (Andreessen Horowitz), have poured in capital.
In 2017, Polychain's return was as high as 2303%, making it one of the best performing companies among billion-dollar investment companies so far.
datadata, from April to December 2018, the value of assets under management at San Francisco-based hedge funds fell roughly 40 percent, while the overall cryptocurrency market capitalization fell 50 percent over the same period.
On the other hand, Polychain is also going through a stage of "halo fading". But in the past year, due to investment losses and the withdrawal of some early investors, Polychain has shrunk by 40% of the $800 million it made for customers last year. Investor concerns about the fund's return promise; plus, chief venture partner Ryan Zurrer was fired following a poor 2018 performance.
In the document submitted by Polychain to the US SEC this time, it admitted that there are major risks in investing in encrypted assets, and wrote: "It cannot be ensured that digital assets will maintain their long-term value in terms of future purchasing power, or that mainstream retailers and commercial enterprises will pay for digital assets. Acceptance will grow."
But even if the asset management scale has shrunk sharply, Polychain's status and prospects in the field of blockchain investment are still not to be underestimated. According to its filing, the firm manages five funds: Polychain Master Fund, Polychain Master Fund II, Polychain Ventures, Dfinity Ecosystem Fund and Polychain Opportunities Fund I.
In addition, the current total market value of the POS public chain in the staking equity pool is about 6 billion US dollars. As the "Bitmain of POS mining", as it is dubbed in the circle, its advance bets on star public chains such as Nervos, Cosmos, Tezos, and Dfinity , It is not without the possibility of a comeback.
At present, Polychain's latest investment includes: In April this year, together with encryption venture capital Andreessen Horowitz, it invested in the stable currency plan of blockchain payment startup Celo; in March, together with encryption venture capital Digital Currency Group, it invested in the physical delivery encryption futures exchange Coinflex .
