Strategies

Rails

The cryptocurrency market is full of opportunities to perform actions that serve as the rails that transactions and other activities operate on.

The most obvious opportunity to do so is by mining, or serving a given cryptocurrency blockchain to verify transactions. This is an area which has grown to demand highly-specialized and expensive computing equipment, pricing out the average participant. The Dividend Crypto Fund has secured an agreement with an NVIDIA authorized re-seller to purchase the required hardware. Additionally, the Dividend Crypto Fund has agreements with office lease providers who do not require the group to pay for electricity, a material cost savings. The Dividend Crypto fund purchased its first mining rig in March 2018 for $9,050 which will primarily mine BCH and ZEC for an average return of $1,000 (equivalent) per month. We plan to add several more before the end of the calendar year.

The fund will offer loans on ETHLend. ETHLend offers a decentralized lending service where parties are matched in a true open-market. It is a small but strong audience that has successfully issued loans in excess of 4,000 ETH at the time of publishing. ETHLend is a  tool for cryptocurrency holders who wish to hold an asset while also unlocking short-term liquidity: a person with a multi-year position in ETH, for example, may be comfortable putting their holding up as collateral for a loan in another asset that they may then use for trading. This service enables greater liquidity.

Investing

In addition to holding a well-diversified portfolio of the top-ten cryptocurrencies, the Dividend Crypto Fund has two primary investing strategies.

When a new cryptocurrency is issued, it is commonplace for a group of investors to pool resources and approach the project owner, offering to buy a large amount for a discount from the public price. This often results in a deal where the group achieves a 30-60% discount, so long as they promise to hold their token for 6-12 months. This process is known as ICO group buying, and it’s something our group is experienced in doing. The group will, in most cases, seek to exit positions at the end of the lockup period in a quiet and non-disruptive (to the general market price) way. Further, we will leverage our community to build awareness of these new coin projects, in recognition of the fact that building value for these new tokens only makes our profit greater. We will seek projects with a strong founding team, existing business models and partnerships, little regulatory risk, strong project governance and strong token economics, and discounts (or bonuses) of 50% or more, ensuring a clear path to trade profitability. If you are involved with a project interested in investment, tweet or direct message us on Twitter @DividendCrypto.

Trading

Outside of the major digital currencies, there are hundreds of alternative coins and tokens which serve specific purposes. The Dividend Crypto Fund will formulate short, medium, and long-term opinions on general market conditions which may lead to sharp value changes for these lower-volume assets, and capitalize on such movement. It is not uncommon for assets in this class to realize gains of 5-10x in a short period of time, something Dividend Crypto Fund will seek to achieve across a portfolio.

It is no secret that the top-ten digital currencies are volatile relative to traditional financial vehicles. In the span of a few short months, bitcoin reached a high around $20,000.00 USD before falling to a value around $6,000.00 USD per coin. This volatility exists in the span of months, but it also exists within a single day: it is common for assets like bitcoin, Litecoin, Dogecoin, and Ripple to trade within 3-5% ranges each day. With advanced analytics tools, intimate knowledge of the top-ten digtial currencies, and professional traders, Dividend Crypto Fund is well-equipped to execute those trades daily.