Valkyrie Investments, one of the largest cryptocurrency asset managers, has announced that it will launch a chain challenge fund next week. This new fund would be significantly different from other similar offerings, due to the location of the assets that will be available to generate a return in multiple protocols. $ 100 million has already been put in place for this initiative.
Valkyrie launches on-chain challenge fund
Valkyrie Investments announced yesterday the launch of its first chain challenge fund, which will hold a portfolio of challenge blue chips. The difference between this fund and similar offerings is in the location of its funds. While other funds passively track asset prices, Valkyrie offers to hold the on-chain assets. This means that they will be able to use them to earn a return and passive income by positioning these assets in different protocols.
Wes Cowan, CEO of Valkyrie of challenge, said:
This allows us to participate in the upside while also getting extra return through loans, cash pools, farming, and staking in the challenge ecosystem. We get the appreciation plus the compound return generated by participating in the chain challenge.
The fund will start with $ 100 million from several investors and the firm’s general partners.
Exotic Tokens and Stablecoins
The decentralized financial environment is a large and diverse movement present across multiple cryptocurrency chains. While other investors are primarily positioned to invest in established protocols like Ethereum, Valkyrie’s proposal appears to be more adventurous. Cowan confirmed this when he listed the channels in which this fund seeks to invest. Cowan said:
We see plenty of opportunities on blockchains, including Ethereum, Avalanche, Solana, Binance Smart Chain, Matic, and Fantom.
While this mention might not mean that they will invest in native tokens in these environments, the mention of some of these options is interesting and is a testament to the growth of some of these chains. However, the composition of the portfolio, regarding the tokens and in what proportion they will be held, is still not defined.
Cowen acknowledged that stablecoins could play an important role in the portfolio, adding:
Although even when they are in stable rooms, they are still deployed on the line to generate yield.
The launch of this fund could trigger a trend inspiring other players to deploy their on-chain assets to earn a return by positioning them, but it also introduces new risks for those who invest in the fund.
What do you think of this new Valkyrie Chain Challenge Fund? Tell us in the comments section below.
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