This blog post is the fifth report in 2024 about the Kaleido Digital Asset Core Strategy. Read more about our crypto portfolio framework here. Don't forget to sign up to our newsletter to get the next reporting straight in your mailbox!
The month of April was dominated by the Bitcoin halving on April 19, 2024. As in the past, (too) much attention was paid to the whole story surrounding the halving, which was reflected in a non-event in prices. More influential last month were the global events surrounding Iran and Israel as well as the market becoming more concerned with a recalibration due to lower than expected inflation the longer the month went on.
The first led to a massive market slump on the weekend of April 12 and 13, with the more illiquid altcoins (coins other than Bitcoin) suffering much more than Bitcoin. The second then led to a further price slide, which did not spare Bitcoin either. This resulted in a negative performance of -21.3% for the strategy at the end of the month. The fund launched in mid-March was able to limit the loss to -15.5% in the middle of the month through targeted portfolio building and corresponding additional purchases.
Correcting markets after the Bitcoin Halving
Even though Bitcoin has outperformed, especially in the first half of the month, and has achieved a dominance, i.e. a market share, of around 57% of the entire crypto market, the KDAC strategy can even keep up with a Bitcoin-dominated strategy of a Bitwise 10. A HODLV, i.e. a strategy consisting of five equally weighted coins, can even be significantly outperformed.
KDAC is outperforming Bitwise 10 Index and HOLDV
We view the current price slumps as typical events during a bull market and remain positive for the coming months. A key element of this is the staking strategies implemented in the KDAC strategy, which offer attractive earnings potential even in possibly quieter summer months with sideways prices by accumulating and holding new coins on a daily basis.
Staking contributing still more than 17% since inception
The staking component as well as the relatively high proportion of altcoins, i.e. coins other than Bitcoin, can make the difference for the portfolio as soon as capital flows from Bitcoins to altcoins take place.
Disclaimer: This piece of information is for marketing and entertainment purposes only and should not be taken as an investment recommendation. Remember that all investments involve risk. Please read our full Marketing Disclaimer here.