The debate between active and passive investing has been ongoing in traditional investment management for a long time. When it comes to investing in the liquid token market, we believe that active management is crucial. Similar to the stock market, we expect a fat right tail in digital asset returns, with only a few assets driving the majority of wealth creation.
Bitcoin has historically been the primary wealth creator in this asset class, and passive portfolios have generally underperformed BTC. Our analysis suggests that value investing in digital assets may be challenging, and it's best to either buy and hold BTC or use active management to find tokens with fundamental momentum and potential to rise into the top ranks of the market.
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