The opinion of the owners of large financial assets on cryptocurrencies has always been ambiguous. Initially, many large players treated this phenomenon almost with derision, believing that real dividends could not be derived from cryptos. Then, with the growth of the exchange value of Bitcoin, they watched cautiously, trying to find out what kind of beast it was and what it fed on, and recently they have begun to make large investments in digital assets. Only time can tell how cryptocurrency has managed to reverse the negative trend for itself and what will become of the large-scale players' attitude toward it in the future. For now, it is possible to recall the dynamics of these changes by the example of individual funds and investors.
Are Dictatorships the Reason for Crypto Volatility?
Back in January, George Soros called cryptocurrencies a bubble, and investments in them unprofitable because of the high level of uncertainty. "While there will be dictatorships in the world, cryptocurrencies will be subject to strong fluctuations, as rulers of such countries always want to lay golden eggs abroad, which is already easy to implement with the help of Bitcoin. Because of this factor, the volatility of the cryptocurrency will not go anywhere," said 87-year-old Soros back at the international economic forum in Davos.
After the billionaire investor reported his attitude towards cryptocurrencies, the cost of Bitcoin fell by 41%. Moreover, during the past six months, some investors have seriously doubted their investments. The former hedge fund manager Mike Novogratz postponed his plans to launch a crypto fund in December, switching the main vector of his activity to a commercial bank focused on crypto resources and enterprises based on related technologies.
But, the $26 billion Soros family firm still plans to start trading digital assets. According to rumors, Adam Fisher, who oversees the macro investment in the company, got the go-ahead for trading cryptocurrency several months ago. Officially, however, this information was not confirmed.
At the same time, Soros himself indirectly made a bet on crypto. In the fourth quarter of last year, his fund bought out a stake in Overstock.com, a large retail site that accepts cryptocurrency. Quantum Partners LP acquired shares of the company for a total of $100 million.
At the same time, $20 million will go to the development of the blockchain company DeSoto Inc. specializing in the management of property rights. The remaining $80 million will be invested in the Overstock trading platform and various blockchain projects.
Other macro investors turned to cryptocurrency as the volume of profit of their hedge funds began to decline. For example, John Burbank, managing director of Passport Capital, plans to raise $150 million for two funds investing in cryptos.
The Bet on eSports and the Internet of Things
In early April, it became known that Mangrove Capital Partners, one of the leading European venture capital funds, will invest in DreamTeam, the world's first infrastructure platform and payment system for eSports and gaming.
The fund seems to have absolutely no doubt in the correctness and prospects of its decision for both parties. According to investors, in addition to the fact that the platform provides a full set of tools for millions of players who want to create, develop and manage their eSports teams for the purpose of their further monetization, DreamTeam has all the potential to become the only universal payment system for the eSports industry thanks to the use of blockchain technologies and smart contracts. "The idea of combining an eSports platform with a simple and transparent technology of smart contracts based on tokens is probably the most powerful eSports solution available today," said David Waroquier, a partner at Mangrove Capital Partners.
And if Mangrove's investments cannot be considered surprising, given their track record and orientation to internet startups, then the arrival of players far from IT on the market can be safely considered a good sign for the development of cryptocurrency in the future. A vivid example of such unexpected cooperation is the investment of the Robert Bosch Venture Capital (RBVC) venture fund into the IOTA tokens issued by the startup, which creates a distributed payment system designed to securely and efficiently transfer data and payments without commissions between devices on the Internet of Things.
The exact amount of the deal has not been disclosed, but the fund's representatives note that they are betting on the development of the internet of things, and that is why they consider contributions to such enterprises to be completely justified and farsighted.