In spite of the economic stagnation caused by Covid-19, the market for crypto funds, which manage cryptocurrency assets to generate profit, is showing rapid growth. In particular, the fact that funds are incorporating not just Bitcoin (BTC) as the best-known cryptocurrency, but also relatively new crypto assets such as stablecoin, is contributing to the expansion of the market’s size. This is positive news for the crypto market as a whole since an investment portfolio can be composed that targets a diversity of assets and is not biased towards one single basic asset.
Growing digital asset funds
Global digital asset management company Grayscale announced its best-ever quarterly result. According to Grayscale’s 3rd quarter release, the company attracted a total of $1bn in investments. Including the 3rd quarter investment inflows, the total investment attracted this year is about $2.4bn, twice the amount received between 2013 and 2019. Grayscale’s main investment product – the fund product Bitcoin Trust (GBTC) which we introduced in a previous newsletter – attracted $719.3M in investment in Q3.
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SPiCE VC, the first venture capital fund to be tokenized, announced plans to create a $100M fund early this month. SPiCE VC expressed optimism about reaching its goal by the end of this month and revealed that major institutional investors are already participating and plan to cover the majority of the investment amount. The company further announced that while this fund is currently not yet realized, the previous fund generated over 65% profit over 2 years.
Cryptocurrency and digital asset funds already in operation are also showing good performance. American crypto investment company Pantera Capital revealed its profit in a newsletter to investors last month. Pantera’s digital asset fund recorded 168% in profit and the value of its ICO fund increased by 323%. The company reported its total volume of digital assets under management as nearly $500M.
Haru Invest adds investment product for USDT
Yet despite these digital asset funds’ high-profit rates, their products remain pie in the sky for normal investors. This is because the investment requirements are excessively high. The vast majority of digital asset fund operators have strict investor accreditation requirements and set a high minimum investment level of around $100,000.
In addition, they charge high fees for asset management and investment performance. According to Crypto Fund Research, digital asset operators charge an average of 2% operating fees and 2% performance fees. In the case of Grayscale’s GBTC, the product is even traded at a 30% premium over its net asset value (NAV).
Formerly known as Haru X, Haru Invest has almost none of these investment barriers. Haru Invest has no separate operating fee and only charges a performance fee of 15% of the profits if the annual percentage rate (APR) return exceeds 15%. There are also no investor certification or minimum investment amount restrictions.
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The investment performance is also good. Haru Invest is an investment product with a 25% annual return target. Between last January and August, its operating profit stood at 19.9%. On an annual basis, we expect to reach a return of 30.99%, thereby exceeding our target.
To this, we have now added a fund product for USDT. Because USDT is a stablecoin issued by Tether that preserves its value, it is free from cryptocurrency price volatility. Returns are earned using an algorithmic market trading and hedging strategy, with target earnings of 22.5%. The minimum lockup period is one month and can be extended. The minimum investment amount is only $10 and just like with the BTC product, there is no operating fee and a performance fee of 15% on the entire earnings is only charged if an annualized profit rate of 15% or greater is realized.
The digital asset market is seeing sturdy growth despite the Covid-19 crisis that has gripped the whole world. If there is an obstacle, it is the high investment hurdle. Moving forward, Haru Invest will continue to remove this hurdle, providing a diverse range of products and enabling anyone to easily and conveniently enjoy the investment returns from the digital asset market.
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