Leading Crypto VC Pantera Capital Lost 80% of Liquid Tokens in 2022!
Pantera Capital reportedly suffered an 80% loss of its liquid token fund in 2022 due to the severe bear market in the cryptocurrency industry. Additionally, the company posted a 23% deficit in November alone, a direct result of the catastrophic collapse of FTX.
The loss suffered by the Pantera 2022 liquid token fund is relatively small compared to the decline in value seen by the Bloomberg Galaxy Crypto Index over the same period.
On the other hand, Pantera’s fund had recovered somewhat earlier this month, as revealed (1) in a January investor call posted on YouTube six days ago.
In January, the world’s largest cryptocurrency hedge fund reportedly recouped 47% of its losses. This information was provided during an investor call.
At the time of the call, the multi-strategy vehicle known as the Pantera Liquid Token Fund had a total of $198 million in assets under management by its team (AUM).
Additionally, thirteen tokens have been included in the portfolio of the liquid token fund, which typically invests between 15 and 25 different liquid tokens at any given time.
The liquid coin used by Pantera is “primarily driven by a flexible strategy focused on decentralized finance and related assets,” as the company’s website states (2).
Return to Pantera Investments in 2022
On the investor call, Joey Krug, also co-chief investment officer at Pantera, spoke of many significant events during the spring of last year. According to Krug, the fund has started to shift a substantial portion of its holdings from other cryptocurrencies to Ether (ETH).
This new event coincided with the devaluation of the USDT stablecoin of Terra and Luna, which was Terra’s sister coin. These failures further contributed to what ultimately led to the failure of the Celsius Network cryptocurrency lending platform.
Even though Pantera focused on Ether in the middle of the previous year, the cryptocurrency venture capital firm recently shifted assets to other altcoins in preparation for an alternative season.
Pantera continues to have a bullish outlook on the outlook for alternative cryptocurrencies despite the market showing signs of recovery. However, it’s still far too early to determine if an alternate season has started or is already in full swing.
The growing interest and acceptance for decentralized finance (DeFi) initiatives is reflected in Pantera’s plan to return some of its funds to alternative cryptocurrencies.
Pantera believes that many of these companies, which rely on alternative cryptocurrencies as a means of facilitation, have the potential to disrupt established forms of financing. This implies that alternative cryptocurrencies have the potential to change the current state of the economic environment over time.
Cosmos (ATOM), Chainlink (LINK) and Optimism were Pantera’s three best performing alternative cryptocurrencies in November last year (OP). On the other hand, the bottom positions were taken by Uniswap (UNI), Solana (SOL) and Ethereum.
As the first months of the new year draw to a close, the possibility of an altcoin season is still being debated. Nevertheless, some alternative cryptocurrencies have seen a meteoric rise in the last bull run in 2020-2021, with some values soaring up to 400 times.
Bitcoin (BTC) continues to trend higher during this period, with its price remaining 1.1% higher than the previous week. This is even though a recent drop has occurred. The leading cryptocurrency continues to hold a strong position, as indicated by the Bitcoin Dominance Index (BTCD), which currently sits at 44.4.
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