What key principles from traditional finance and investment do you find most relevant and applicable to the emerging cryptocurrency and blockchain sector?

Prior to crypto, I was a private equity investor for 3.5 years focused on buyouts, growth equity investments and roll-ups; touching every industry under the sun from premium pet food manufacturing to regenerative cellular technology. My personal portfolio is fairly common sense and diversified, but also includes exposure to alternative assets like Midwest farmland, emerging market residential real estate, a craft beer shop here in Hong Kong, and other ‘fun’ investments. Across all of these various asset classes, industries and jurisdictions, however, the principles of investing remain the same. Whether at Wharton, funny enough the alma mater of the entire Maelstrom team, or Wall Street or Sand Hill Road or the Cryptoverse, investors are looking for:
1) high quality founding teams;
2) meaningful growth potential (i.e. TAM);
3) competitive advantages that can lead to lasting profitability;
4) paths to liquidity for the investment itself. Crypto is fundamentally no different.

People perceive cryptocurrency investments as highly volatile. What advice do you have for both institutional and retail investors seeking to navigate this volatility and make informed investment decisions in the crypto space?

This misconception, that crypto investments are inherently ‘more volatile’ than any other type of venture-stage investment, is a funny one. Old-school Silicon Valley venture-stage equity investments create the illusion of stability simply because they are illiquid, and their performance opaque to the market. Nobody outside of that seed stage venture-backed start-up knows if they had a stellar quarter (and hence worthy of a mark-up) or are on the brink of collapse (and about to be written off); and even if they did know, it’s difficult to trade off of that information. Referring to that as a ‘more stable investment’ is a logical fallacy; you’re simply stuck holding duds for longer, and prevented from doubling down on winners. Crypto investments, on the other hand, are almost immediately liquid (24/7 secondary markets on exchanges), with many key performance metrics transparently on-chain for all to monitor. Investors entering the crypto space should use this to their advantage, to double-down on undervalued winners when markets irrationally dip, to shore up their long-term high-conviction bets. Maelstrom holds investments for 3-5 years, and takes advantage of temporary mispricings to dollar-cost average down and scoop up what the market has mispriced.

What shifts and trends do you see in the cryptocurrency and blockchain investment landscape, and how are these changes influencing your investment strategy?

I started off in crypto back in 2013, moonlighting as a recreational investor dollar-cost averaging into BTC, LTC, ETH, LINK, etc. before getting caught up in the ‘white paper’ hype of 2017/2018. Then in 2019, I left my private equity job in Chicago and moved to Hong Kong to enter the space professionally with BitMEX Ventures, prior to helping Arthur launch Maelstrom last year. This is now the 3rd ‘bear market’. This ‘bear market’ looks and feels quite similar to the previous ones - an irrationally gloomy market sentiment with retail overlooking or unaware of the innovative teams that are heads down building apps and infrastructure in stealth. Each bull-bust cycle tends to follow this pattern:

Phase 1) The previous bull cycle ends when something breaks, doom and gloom ensue;

2) ‘Tourist capital’ feels;
3) Long-term builders keep building and new innovative apps catch the market by surprise;
4) These apps inspire the development of new kinds of infrastructure to support them (that won’t be ready until the next bull cycle);
5) Those innovative new apps get out over their skis and something breaks; Rinse and repeat (but with upgraded infrastructure from #4).

This bear market, however, is unique in that there is genuinely committed long-term ‘smart money’ aggressively doubling down, and mixed (but leaning net positive) signals from regulators.

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