BitBull Capital’s BitBull Fund, offering accredited investors exposure to diversified, actively-managed investment strategies in blockchain and cryptocurrencies, has outpaced Bitcoin by about 100% year to date.
There is a growing demand for such investment vehicles, with nearly 30% of high-net worth investors interested in taking positions within the cryptocurrency market, whether via a crypto ETF, index fund or hedge fund.
However, as recent crypto market activity saw BTC shed one-fifth of its price in a 24-hour period, accredited investors are often justifiably cautious, even as top crypto analysts urge taking a second, deeper look when events like this occur.
Regarding Bitcoin’s recent moves, BitBull Capital’s Fund Manager Joe DiPasquale commented “crypto has repeatedly shown support at key levels, with an increasing amount of demand from institutional investors.” From family offices to foundations, many investors are diversifying into digital assets. Along with family offices and high net worth individuals, venture capitalists and angel investors have been early-movers in the space. The approach by BitBull Capital, including its fund of funds model, is an option for accredited investors looking to reduce downside risk while gaining an outsized portion of upside and capitalizing on a large deal flow for future crypto “unicorns”.
More recently, university endowments like Harvard, Stanford, and Yale; and public pension funds like the Fairfax County Police Officers Retirement System and Fairfax County Employees’ Retirement System, have invested funds in crypto funds.
To create alpha, BitBull Fund works to find funds and investments that have the potential to outperform Bitcoin or many crypto indexes, such as the Bitwise 10. BitBull’s Fund of Funds approach attempts to offer investors the opportunity to benefit from active fund management that contrasts itself with the beta of a buy and hold strategy or market-cap-weighted index fund, for example. Instead of mirroring the volatility of the market -- or tracking the market -- funds like BitBull Fund focus on outperforming the market.
Another of the BitBull Capital methods used to achieve this has been providing investors with exposure to exclusive and early access to unicorn projects and ICOs and equity in more traditional companies like Coinbase, which have direct or adjacent focus in the crypto market.
Investors in BitBull Fund have gained early-stage exposure to top-tier crypto projects like Polkadot, Dfinity, Mythical Games, 1inch, and Uniswap. They range from traditional digital currencies to decentralized finance (DeFi) and Non-Fungible Token (NFTs) to Metaverse and Play-to-Earn investments.
It’s this multi-strategy approach that has enabled BitBull Fund to outperform Bitcoin by 100% this year, and as accredited investors are seeking to understand how to evaluate crypto hedge funds going into 2022, it is clear that fundamentals are just as important to successful hedge fund performance as they are to the longevity of Bitcoin and other digital currencies.
In the case of crypto market analysis, it is wide-span, event-driven fundamental analysis within a hedge fund investment vehicle where apparently even volatility can be profitable.
This is especially notable when comparing crypto markets to traditional markets.
In response to a question about ProShares Bitcoin Strategy ETF, one of the other popular crypto funds available to accredited investors, DiPasquale said, “as inflation worries mount it is typical for investors to consider alternative options and the presence of BITO gives them the potential for exposure to an asset class known to outperform traditional markets. ”
DiPasquale says, “Bitcoin's latest correction is another opportunity for long-term bulls to gain exposure since the macro structure as well as on-chain metrics continue to hint that more bullish price action is yet to come.”
For more information on BitBull Fund contact [email protected].
BitBull Capital GP, LLC (“GP”) and BitBull Capital Management, LLC (“IM”) are, respectively, the general partner and investment manager of funds including the BitBull Fund and BitBull Opportunistic Fund (collectively, “BitBull”). The GP and IM are not registered investment advisers with the Securities and Exchange Commission or any state’s securities commission. The limited partnership interests (the “Interests”) in the Fund are offered under a separate confidential private placement memorandum (the “Private Placement Memorandum”), have not been registered under the Securities Act of 1933, as amended (the “Securities Act"), or any state securities laws, and are sold for investment only pursuant to an exemption from registration with the SEC and in compliance with any applicable state or other securities laws. Interests are subject to restrictions on transferability and resale and may not be transferred or resold except as permitted under the Securities Act and applicable state securities laws. Investors should be aware that they could be required to bear the financial risks of this investment for an indefinite period of time. PAST PERFORMANCE DOES NOT GUARANTEE FUTURE RESULTS. Certain information contained on this site may constitute “forward-looking statements” which can be identified by use of forward-looking terminology such as “may,” “will,” “target,” “should,” “expect,” “attempt,” “anticipate,” “project,” “estimate,” “intend,” “seek,” “continue,” or “believe” or the negatives thereof or other variations thereon or comparable terminology. Due to the various risks and uncertainties, actual events or results in the actual performance of the Fund may differ materially from those reflected or contemplated in such forward-looking statements. The GP is the source for all graphs and charts, unless otherwise noted.