Institutional Crypto Allocation: Liquid vs Venture - Insights from Token 2049 Roundtable

At TOKEN 2049, a roundtable titled "Institutional Crypto Allocation: Liquid vs Venture" featured insights from leading figures in the crypto space: Tom Schmidt, General Partner at Dragonfly; Arthur Cheong, Founder of DeFiance Capital; Pranav Kanade, Digital Asset Fund Manager at global asset management firm VanEck; and Tushar Jain, Managing Partner at crypto-native fund Multicoin Capital.

The discussion revolved around the strategic allocation of capital within the current crypto market. Participants stressed the need for caution against overly aggressive strategies, highlighting the potential risks associated with such approaches. They underscored the importance of learning from past market fluctuations.

While some crypto investment strategies have yielded impressive returns, reaching up to 120% growth in the past year, the overall market growth has been around 50%. This disparity in performance prompted the question: Why choose one specific crypto investment strategy over another that has delivered similar results?

The panelists unanimously agreed that the expertise and market insights of investment managers are crucial factors. They emphasized that simply paying management fees to hold assets is not a logical approach. Managing liquid capital relies more on professional knowledge than mere exposure.

Market sentiment emerged as a key driver behind differing asset performance. The panel highlighted how market sentiment, largely driven by belief and expectations, can lead to significant variations in asset performance. They also acknowledged the unique characteristics of the crypto market, demanding greater risk awareness and strategic vision from investors.

Looking ahead, panelists expressed optimism about the future of the crypto market. They suggested that the influx of retail capital in 2021, fueled by wealth generated from the stock market, would likely repeat itself. While acknowledging potential short-term volatility and challenges, the panelists emphasized the long-term value and potential of cryptocurrencies as an integral part of the emerging financial system. Each manager, they said, maintains a unique strategy but all closely monitor market and token economic shifts.