A fund run by value managers thinks it can give investors more returns than the digital currency.
The best performing asset of the decade has been called Bitcoin. In the last five years, the fund that uses a traditional value investing strategy, called Off the Chain Capital, has beaten the market.
The fund has averaged 133% per year since its inception in 2016 compared to 108% per year for bitcoin, according to Off the Chain. The firm used a beginning date of December 31, 2016 and a ending date of February 28, 2022.
Brian Estes, the fund's CEO and chief investment officer, said that the fund has done better than bitcoin five out of the last five years.
It said that it has outperformed the S&P 500 by 3,653% in the same period, and that the two do not move up and down in tandem.
The fund's strategy is to find mispriced assets.
Rather than buying the assets at fair market value and letting them rise, it wants to buy one dollar worth of assets for 50 cents. It can apply a value approach while capturing the growth of the industry.
Two years ago, Off the Chain was a big buyer of the shares of the company, which went for about 70 cents. The closing price of the stock was $15.79 a share.
Estes says that Silvergate Bank is being mispriced. Two years ago, the bank went public and was valued as a bank.
It was being valued at eight times earnings, and three times book value, and people didn't understand that Silvergate is a monopoly on most of thecryptocurrencies.
Its earnings are growing at a rate of more than 100% a year.
Private equity makes up half of the portfolio. Mispriced digital assets are looked for by the firm.
Off the Chain is a large buyer of Mt. Gox has filed for bankruptcy. Mt. A Russian hacker stole about 740,000 bitcoins, worth $460 million, from Gox, the largest custodian of the virtual currency.
Estes said that the fund buys those claims at a discount.
It is our belief that the winner of the store of value is the digital currency, and that it is a major instrument for portfolio allocators. If you can beat the fund, you should just own and not pay fees to manage it.
The utility token, BNB, is seen as an undervalued asset.
The exchange is currently valued the same as Coinbase, but it trades about 4.2 times the volume of the exchange.
The fund has more than $400 million under management. It mainly targets institutions, endowments, family offices and other high net worth individuals for a minimum of $1 million.
The fund has the capacity to add another $200 million. It is very likely to be opening an artificial intelligent trading fund in the next six months.
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