Ali Hassan, co-founder, and CEO of Crescent Crypto Asset Management was interviewed by Bloomberg Markets. Upon being asked about Bitcoin ETF, Hassan was very candid in mentioning that there is a possibility of SEC approving the Bitcoin-only ETF in the next 18 months.
Investor Protection a key hurdle for SEC clearance
According to Hasaan, the SEC is really concerned about retail investors protection as they would be exposed to a volatile and unregulated market of cryptocurrencies. According to him, that’s why a mutlicoin product makes much more sense at this time than an individual coin product as it takes away a lot of volatility from the underlying assets. To quote him,
“The SEC wants to see investor protection, in specific for retail investors and what the community is saying is passive vehicles will actually increase the participation in the market and reduce some of those concerns. We do think that a product is coming soon. There are some very interesting products on the market right now. The VanEck product is something that we’d like to look out for. Those are all single coin products though.”
On being asked about the BTC prices his answer was “[It’s going] to the moon. We’re expecting it to go much higher”
Crescent crypto asset management doing things right
According to Hassan, passive investment in cryptocurrencies seems to be the best strategy for investors and that’s what its investors in US like. He feels it’s a really good way to get exposure without manager bias and it comes out to be a lot cheaper and tax effective. Giving an example, Hassan mentioned that passive investment does reduce the asset volatility by “holding 20 coins with slightly different levels of correlation and using a 90-day trailing average market cap.”
He says just because of this approach his fund hasn’t seen a single redemption yet and he sees a continuous demand for mutlicoin products, irrespective of their falling prices
Crescent was created by three former Goldman Sachs executives in late 2017. The three co-founders, Christopher Matta, Michael Kazley and Ali Hassan, who are also the chief executives of the firm, were all under 30 and wanted to leave their banking career behind to create a crypto index fund. They ended up creating the Crescent 20 Private Index Fund, which maps the 20 largest cap and most liquid cryptocurrencies in the market. All coins that do not meet “stringent institutional thresholds” are excluded from the index. The fund only approaches wealthy US investors, whose annual salaries are above $200,000.
The index represents 1 percent of the 2,000+ cryptocurrencies existing in the market today. It includes Bitcoin, Ethereum, Ripple, Bitcoin Cash, EOS, Litecoin, Stellar Lumens, Tron, Neo, and Dash. Other currencies held by the fund are Monero, NEM, VeChain, Ethereum Classic, Qtum, OmiseGo, Icon, Lisk, Zcash, and Ontology. These 20 currencies hold over 90 percent of the total market cap of cryptocurrencies. Of these, Bitcoin holds the largest weight in the fund (44.7 percent), followed by Ethereum (19.3 percent), Ripple (8.7 percent) and Bitcoin Cash (6.1 percent).
Looking at the security aspect the fund stores all its coin in cold storage thus eliminating the exchange risk associated.