Digital Wealth Insider - Portfolio Update July ‘24
First and foremost, thank you for your continued partnership on this investment journey. Your support is invaluable to us.
The dips are where the money is made….
Fund Performance
The fund's performance this past month was down approximately -22% (net of fees). The fund has a positive annualized return of +24% since the fund launched in August 2023.
We are experiencing volatility in a volatile asset class.
There’s no sugar-coating it, drawdowns suck. However, this kind of volatility is completely normal for the asset class.
The ability to weather short-term pullbacks is required to be successful in crypto.
We feel the fund is perfectly positioned to take advantage of the eventual shift to more bullish market conditions and prices. (more on that below)
What we expect for Q3 2024 and Q4 2024
We believe the next month or two may be the last opportunity for this cycle to buy positions at these low prices.
We encourage investors who still have capital to deploy to take advantage of the dip to invest while there is blood in the streets. (we are personally deploying capital into the market)
We’ve got a great amount of data below that we believe supports why now is the perfect time to enter the market.
If you’re an accredited investor and you agree that now may be a great time to diversify your crypto portfolio but you’d prefer an easy button to access over 100 fully vetted positions, click here to hop on a call with me to discuss.
'Be fearful when others are greedy and greedy when others are fearful'
-Warren Buffet
Reasons we remain bullish (along with many other industry experts):
Contrarianism often pays in a big way.
If you look at the graph below, low fear/greed market sentiment tends to precede a massive market rally.
We are currently at around 27, look below to see what happened last time the fear/greed indicator reached those levels.
(hint, BTC almost 4x’d in price!
Over the past 12 years, Bitcoin has followed a 4-year cycle pattern. We may currently be witnessing a bear trap, similar to previous cycles, which often precedes the most robust phase of the bull market.
Retail investors have yet to return to the markets. Many of the previous cycle highs were driven by retail interest.
Coinbase users, Google & YouTube metrics, and market trading volumes all indicate retail activity remains well below past bull market levels. Despite this, we’ve seen Bitcoin reach $70k levels.
Imagine where prices might go when retail interest joins the party 👀
The high sell pressure from governments that have been driving the price of BTC down are almost over.
The German government selling off $BTC holdings will dissipate.
At the current rate, Germany won’t have any bitcoin left to sell in the next 10 days.
German Government’s $BTC Balance
Crypto-friendly political policy continues to make headlines:
Trump has been more supportive of crypto than any other presidential candidate in history. Whether you tend to vote left or right, this has had noticeable effects.Democrats are realizing they need to ease up on anti-crypto posturing and take a second look at the technology, if for no other reason than to attract voters.
Republicans are embracing Trump’s message of making the US a central hub for the technology.
Expert Voices are Bullish: Tom Lee predicts BTC will hit $150k by the end of the year.
Tom Lee has crushed a lot of previous BTC and Stock market calls.
Much of retail participation reacts to price movements which results in erratic price changes. We believe the space is evolving towards fundamentally sound companies solving real problems, I talked about this last week:
Education Section: Why are token buybacks changing the tokenomics game?
Tokens in the Web3 space are very easy to deploy; someone can create a simple token in less than an hour. This causes a market dilution problem, which we discussed in our last newsletter.
Some sophisticated projects are flipping the switch to take tokens out of the market. They are initiating token buyback & burn programs, where a portion of revenues is used to buy back tokens and remove them from circulation. This is bullish because it makes the token supply deflationary, typically increasing price valuation.
Fund Composition
The fund currently has approximately 100 positions across 27 different blockchains.
Yield (interest awarded for various on-chain activities) is being generated from 39 unique protocols. Managing this breadth is time-intensive but crucial for mitigating risks and maximizing returns.
~86% of all assets are secured via cold storage, the industry’s highest standard for keeping assets safe. The other 14% of fund assets are on Kraken, known for its robust security standards.
Airdrops: Free Money
We received a $15,000 airdrop from Blueberry Protocol for staking $60k just 3 months ago (thats 100% APR)!
Trust the process and stay confident. We’re in this together, and brighter days are ahead.
Talk soon,
Mike Klein
Digital Wealth Insider
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Disclaimer: The information in this newsletter is for general informational purposes only and is not financial or investment advice. All investments involve risk, including the loss of principal. Past performance is not indicative of future results. Consult with a professional before making any investment decisions. Digital Wealth Insider is not responsible for any losses or damages from the use of this information.
