Information Memorandum – deVere Aggressive
Digital Asset Fund SPOpportunity to invest in a Digital Currency Fund
March 2018
1 Offering Overview
deVere Adventurous Digital Asset Fund SP 3
About the Fund
deVere Adventurous Digital Asset Fund SP is an actively managed cryptocurrency fund aimed at professional investors
To be the best performing investment fund in
the Digital Currency space
OUR MISSION
To deliver capital appreciation over a long term
horizon through actively managing a portfolio
of Digital Currencies
OUR INVESTMENT OBJECTIVE
The Fund will invest in a diversified portfolio of
digital assets via algorithmic trading over AI
platforms, utilizing a long only quantitative
trend following approach
OUR INVESTMENT STRATEGY
deVere Adventurous Digital Asset Fund SP 4
deVere Adventurous Digital Asset Fund SP Terms
KEY FACTSFUND STRUCTURE
Fund Name deVere Alternative Investments SPC Ltd.
Sub-fund Name deVere Adventurous Digital Asset Fund
Domicile Cayman Islands
Type of shares Accumulator
Base Currency USD
Minimum Initial
Subscription $100,000
Investment
Objective
To achieve long-term capital growth primarily
through a long only quantitative trend following
approach investing in a diversified portfolio of
digital currencies
Portfolio limits Up to 100% - Digital Currency
Dealing Monthly
Entry Fees 5%
Exit Fees 1%
Management
fee2%
Performance
fee20%
Hurdle Rate None
Dalma Capital
Management Limited
Investment Manager
Grant Thornton
Cayman Islands
Fund Auditors
Wyzer Ltd.
Strategy Advisor
Apex Fund Services
(Dubai) Ltd.
Administrator
Walkers LLP(matters of Cayman Islands
law only)
Legal Advisers Bankers
Interactive Brokers UK
Prime Broker 1
Exante, Malta
Prime Broker 2
Investors
deVere Alternative
Investments SPC Ltd
deVere Diversified
Digital Asset FundSP 1
deVere Moderately
Adventurous
Digital Asset Fund
SP 2
deVere
Adventurous
Digital Asset Fund
SP 3
deVere Adventurous Digital Asset Fund SP 5
Investment Strategy
The Fund will maintain a diversified portfolio of digital assets through investment in digital currencies, ETFs or derivatives
by way of algorithmic trading through AI platforms, utilizing a long only quantitative trend following approach
INVESTMENT STRATEGYQUANTITATIVE TREND FOLLOWING
APPROACH
3
» Primarily, a quantitative trend following approach is
used in managing the fund’s assets
» The Fund also relies on the professional judgment
of its investment manager to make trade decisions
2
» The fund will maintain at least 20% to 100% of the
value of its assets invested in a diversified portfolio
of digital assets
» Asset allocation may periodically be increased or
decreased according to the relative attractiveness of
each digital currency
1
» Fundamental investment philosophy is to obtain
exposure to digital currencies that exhibit:
– Strong momentum and trending characteristics
– Are sufficiently liquid, and
– Allow for low cost investing
1
» Algorithms define guidelines and trading strategies
that determine which crypto currencies and assets
classes to trade -- trading strategies are based on a
combination of trend following and time-series
momentum models
2» Machine learning algorithms efficiently and
intelligently parse through significant volumes of
unstructured data
3» The approach allows recognition of patterns and
correlations that may be difficult for human analysts
or independent investors to discover and action
4
» The models autonomously adapt to changing
circumstances and scenarios – as market volatility
and direction velocity change so do the fund’s
market positions
deVere Adventurous Digital Asset Fund SP 6
Risk Management
The Fund has multiple risk management measures in place to minimise the risks arising from the volatile digital currency
market
01Algorithmic trading analyses various risk management metrics with the objective of
containing excess volatility and mitigating drawdowns with respect to underlying assets
02Position limits are capped based on various volatility measures
03AI platform seeks to ensure that target strategic asset allocation is maintained and
optimized through monitoring of market diversification and correlation metrics
04The portfolio routinely goes through a scenario and stress testing process
deVere Adventurous Digital Asset Fund SP 7
Technology Overview
deVere’s crypto fund advice system is built on top of a custom developed platform which analyses market data and
suggests rebalancing methods best suited for the current market status
Data Gathering
.
OHLCV Data
The system obtains OHLC data
from a public API (coinapi.io)
Market Cap Data
The system obtains market cap
data from a public website
(coinmarketcap.com)
The system makes use of
various data feeds which are
used by the funds in order to
make rebalancing decisions
The feeds of interest are related
to the prices and market
capitalization of market data
Data Processing
The system supports a number
of arbitrary strategies which it
can use to decide which coins
to trade. They can be custom
built in order to support specific
fund strategies
The platform supports a number
of common technical indicators
which are used to execute
strategies
Every rebalancing time period,
the system determines ratios
which indicate the coins that the
fund will purchase along with
the ratio of funds to be allocated
to each coin
CoinAPI.io Coinmarketcap.com
DB Server Web Server
Crypto Fund
Admin Website
App Server
(Data Collection + Processing)
Investors
The Fund’s crypto fund advice system is split into 2 sections Platform Structure
deVere Adventurous Digital Asset Fund SP 8
Sub-Advisory Team
Dr. Abdalla Kablan is an entrepreneur and academic specialising in
machine intelligence, big data analytics and computational Finance.
He is the founder of Scheduit – a business oriented social network
that uses AI and machine learning to match relevant business
professionals with each other. He is also the co-founder and CTO
of Hippo Data.
He has presented and chaired in various international conferences
and published various blind reviewed papers, some of which won
research awards.
He holds a PhD in Computational Finance from University of Essex,
UK.
Dr. Kablan also has an MSc in Financial Engineering and
Knowledge Management from University of Bradford, UK and a
BSc IT degree in Computer Systems Engineering from the
University of Malta.
Dr. Abdalla Kablan
Digital Currency Advisor
Joseph Portelli has over 36 years’ experience employed in various
capacities within the financial industry in the U.S and in Malta.
He has vast experience as a portfolio manager, currency and
commodity trader and has been employed with BoA, Nomura
Securities, Goldman Sachs, Millburn Ridgefield, Global Capital, and
Liongate Capital Management.
His most recent position was chief investment officer and managing
director of FMG Funds.
He is currently Chairman of the Malta Stock Exchange and sits on
its Audit Committee. He is also the founder and Chairman of
Financial Services Gozo.
Joseph founded the Institute of Investment Analysis and was also a
visiting lecturer at the University of Malta, and has taught courses at
the Central Bank of Malta, Malta Institute of Accounting and other
institutions.
Joseph graduated with a BA from Baruch College, City University of
New York.
Joseph Portelli
Asset Allocation Advisor
2 What are
Cryptocurrencies?
deVere Adventurous Digital Asset Fund SP 10
Cryptocurrencies are set to Revolutionize Financial
Transactions…
Cryptocurrency is an encrypted and decentralized digital medium of exchange that has eliminated the need of
intermediaries such as banks & financial institutions for facilitating and verifying financial transactions
KEY FACTSWHAT is it?
Produced by Technical System
based on cryptographic algorithmIssued by Government
High Cross Border PortabilityLow Cross Border Portability
Controlled Supply; dictated by
coded schedule
Unlimited Supply; Government
can produce as needed
Decentralized no central control,
no central point of failure
Centralized: controlled &
regulated by government
Value is determined by
Demand & Supply
Value determined by the Demand,
Supply & Govt. Regulation
CRYPTOCURRENCYTRADITIONAL CURRENCY» Launched in 2009, BITCOIN was the first cryptocurrency, currently
there are ~1,500 CRYPTOCURRENCIES WORLDWIDE
» Cryptocurrencies use a mechanism called BLOCKCHAIN – which
is a public ledger of all transactions across P2P network that is
TRUSTED, SECURED & SHARED
» Total Market Cap of all Cryptocurrencies: ~$432Bn(1)
(on Feb 25th, 2018)
» Total No. of transactions processed: ~300Mn(3)
(till Feb 25th, 2018)
» As of Feb 2018, there are 2,393 Bitcoin ATMs(4) worldwide
» Transactions processed per day: 145K(3)
(on Feb 25th, 2018)
» Employs ~1,876(2) people full-time in the cryptocurrency space
Sources: (1) Coinmarketcap; (2) Global Cryptocurrency Benchmarking Study by Cambridge Centre for Alternative Finance as of April 2017; (3) Blockchain.info; (4) coinatmradar.com
$
deVere Adventurous Digital Asset Fund SP 11
..And Have Gained Wide Acceptance due to their Unique
Features
Cryptocurrencies are designed such that they are encrypted, controlled by code, rely on P2P networks, and have
immutable transaction history – features that have attracted investor attention in the financial industry
PSEUDONYMOUS
In crypto market, owner’s identification is stored
in an encrypted address controlled by them– it is
not typically attached to a person’s identity1
DECENTRALISED
Currency supply and value is controlled by the
activities of users and highly complex protocols
built into the currency codes rather than any banks
or other regulatory authorities
IRREVERSIBLE
Digital currency transaction cannot be reversed
after a transaction has been confirmed
FAST AND GLOBAL
Transactions are propagated nearly
instantly in the network and are
typically confirmed in a couple of
minutes2
SECURE
The funds are stored in a public key
cryptography system accessible by
only the owner of the private key
CONTROLLED SUPPLY
A cryptocurrency’s supply is controlled by a
schedule written in the code, allowing estimation of
supply at any point in the future
Note: (1) The development of digital identities could reduce anonymity in the future;
(2) Confirmation times can be delayed due to high market volume, mempool overload or low transaction fees offered
deVere Adventurous Digital Asset Fund SP 12
Blockchain – The Technology behind Cryptocurrencies
Blockchain is an open distributed ledger that can record transactions between two parties efficiently and in a verifiable
and permanent way; It has potential to disrupt a wide variety of transactions processing systems
Transaction Requested
» Users with wallets request transactions
» Wallets are files with access to multiple
bitcoin addresses that are in the form of
alphanumeric characters
Authentication
» The network of nodes operated by
miners validate the transaction using
cryptographic hash functions
New Transaction Block
» Miners bundle transactions within a
fixed time interval into new blocks. E.g..
in the case of Bitcoin past 10 min
transactions are bundled into one block
Verified Transaction
» Verified transaction can involve
cryptocurrency, contracts, records, or
other information
✓
✓✓
✓
Blockchain – is a public ledger of all transactions across a P2P network that no individual or company owns or controls. Primary Benefits:
WHAT IS IT? 1. Immutability
2. Elimination of Intermediaries
3. Ease in verification of transactions
4. Improved security
5. Transparency with lower costs
6. Decentralization
HOW IT
WORKS ?
Addition to Blockchain
» The new block is then added to the
existing blockchain
» For addition of each new block a miner
is currently rewarded 12.5 Bitcoins1
Transaction Complete
» Once the new block is added to the
Blockchain the transaction is complete
✓
Note: (1) Bitcoin Block Reward set to halve in 2020
deVere Adventurous Digital Asset Fund SP 13
From its Launch in 2009, Cryptocurrency Market has
Evolved Considerably
The speed of development and adoption of cryptocurrency technology has been phenomenal, dispelling concerns over
its legitimacy and at the same time facilitating the sector’s emergence into the mainstream
Jan-2009:
Very first Bitcoin
transaction
between Satoshi
and Hal Finney,
a developer and
cryptographic
activist
Mar-2013:
Bitcoin market
capitalization
reaches $1Bn
Aug-2015:
Barclays
announces that
they would
become the first
UK high street
bank to start
accepting bitcoin
Jan-2011:
Silkroad, the
infamous drugs
marketplace
begins operating
Apr-2014:
The first ICO
was held by
Karmacoin for
Karmashares
project
Feb-2010:
First real world
bitcoin
transaction takes
place when a
programmer
pays 10,000
Bitcoins for a
pizza worth $25
Apr-2017
Bitcoin 24hr volume
rises over $1Bn as
Japan, Russia move
to legitimize
cryptocurrency
Oct-2008:
A
pseudonymous
figure or group
called Satoshi
Nakamoto
publishes the
Bitcoin white
paper
Jun-2012:
Coinbase, a
bitcoin wallet and
platform, is
founded in San
Francisco,
California
Oct-2009:
First Bitcoin
Exchange New
Liberty Standard
launched, with
an initial
exchange rate of
1,309.03 BTC to
$1
Jul-2010:
The MtGox
Bitcoin currency
exchange market
is established
Feb-2011:
Bitcoin reaches
parity with US
dollar
Jun-2011:
WikiLeaks
begins accepting
anonymous
Bitcoin donations
Nov-2012:
Wordpress
accepts bitcoin
Apr-2013:
Bitcoin price
reaches $100
Oct-2013:
FBI shuts down
Silkroad
Nov-2013:
Bitcoin price
reaches $1000
Jul-2014:
Founded by
Vitalik Buterin
Ethereum
Foundation
raises around
31,500 Bitcoin
through pre sale
of 60Mn ETH
Dec-2014:
Microsoft begins
to accept Bitcoin
Mar-2017
30 banks, tech giants,
and other
organizations—
including JP Morgan
Chase, Microsoft, and
Intel form Enterprise
Ethereum Alliance
Nov-2010:
Bitcoin Market
Cap crosses
$1Mn mark
2009 2010 2011 2012 2013 2014 2016 2017
No
tab
le C
oin
Lau
nch
es
BTC LTC DASHXRP
2015
ETHXMR BCH
2008
Dec-2017
Bitcoin futures
launched on CBOE
and CME Group
markets post which
Bitcoin prices reaches
$19,000
IOTANEO
Feb-2018
Venezuela
launches first
govt-backed
cryptocurrency
‘Petro’
2018
ADAXLM EOS
deVere Adventurous Digital Asset Fund SP 14
Cryptocurrency Regulatory Landscape
Large scale adoption of cryptocurrencies and blockchain technology is forcing countries worldwide to do away with their
restrictive stance and draw up regulations allowing trade and use of cryptocurrencies
Global Cryptocurrency Standpoint1
D
A C
B
E
Unknown: 126
Permissive: 57
Contentious: 8
Hostile: 4
# of Countries by Stance
Sources: Bitlegal.io
Notes: Global Cryptocurrency Standpoint as of Feb 25, 2018
European Union
» In Jun 2017, EU changed laws regulating
cryptocurrencies, allowing only KYC approved
users to transact and hold cryptocurrencies
» Jan’18 - Decided on new rules to decrease
anonymity and more traceability through
customer identification and strong due diligence
E
» 2015 - The Commodity Futures Trading
Commission classified bitcoin as a commodity
» IRS considers virtual currency as property for
federal taxation
» 2017 - SEC ruled that ICOs and Token Sales are
Sale of Securities & participants will be subject to
federal securities law
United States of AmericaA
India
» A formulation committee to work on the
landscape of cryptocurrency policy was formed in
Dec 2017
B
China
» China banned ICOs in Sep 2017 and has
blocked all access to online platforms for
cryptocurrency exchange in order to regulate the
financial market from scams & risks
C
» In Apr 2017 Japan recognized cryptocurrencies
including Bitcoin as a legal method of payment &
not a legally-recognized currency
» For tax purposes Bitcoin is treated as an asset
» Exchanges will be subject to - capital
requirements, cybersecurity & operational
stipulations, AML & KYC requirements, audits etc.
JapanD
3Overview of the
Cryptocurrency
Market
deVere Adventurous Digital Asset Fund SP 16
Crypto Market Cap Reached $432Bn, Representing a
25x Growth since Jan’17
Driven by strong positive sentiment around Cryptocurrencies, market capitalization crossed $500Bn mark in Dec’17 post
which the market saw a slight correction in Feb’18
Jan-15 Jun-15 Nov-15 Apr-16 Sep-16 Feb-17 Jul-17 Dec-17
Bitcoin Other Cryptocurrencies
$3.4
Bn
$0.8
Bn
$165.3Bn
Total Market Cap No. of Currencies
$266.6Bn
Since Jan 2015 the
no. of
cryptocurrencies in
the market has
grown >3x from 494
in the beginning of the
period to 1491 as on
Feb 25th, 2018
Cryptocurrency Market Capitalization
3 Year Growth
2 Year Growth
Y-o-Y Growth
1335 1491494
$4Bn
544
$4Bn
565
$8Bn
686
$21Bn
981
$89Bn $573Bn $432Bn
49x
25x
9x
383x
219x
92x
105x
56x
20x
Growth (2)
Sources: Coinmarketcap
Note: (1) All data as of Feb 25, 2018 , (2) Growth Y-o-Y: Feb’17 – Feb’18, 2 year growth: Feb’16 – Feb’18, 3 year growth: Feb’15-Feb’18
Feb-18
539
$6Bn
637
$12Bn
deVere Adventurous Digital Asset Fund SP 17
Driven by Rising Popularity & Adoption of Cryptocurrencies
Leading cryptocurrencies have garnered significant interest from individuals and institutions alike, a fact validated by increasing
number of transactions, unique addresses, wallets & active users of these wallets
(1) Data as of Feb 25, 2018
Sources: (2) “Global Cryptocurrency Benchmarking Study” by Cambridge Center for Alternative Finance; (3) “Bitcoin: Ringing The Bell for a New Asset Class” by Ark Invest and Coinbase; Blockchain.info,
Etherscam.io
3k
8,873k
Jan-09 Jul-10 Jan-12 Jul-13 Jan-15 Jul-16 Jan-18
9k
20,080k
Jul-15 Dec-15 May-16 Oct-16 Mar-17 Aug-17 Jan-18
Transactions per Month (000’s)(1)
Total Cryptocurrency
Wallets (2016)
34.3Mn(2)
Unique Active
Cryptocurrency
Wallet Users (2016)
2.9 - 5.8Mn(2)
Active
Cryptocurrency
Wallets (2016)
5.8 - 11.5Mn(2)
1324%
Eth
ere
um
Bit
co
in
Holders of Bitcoin as
of Dec, 2016
10Mn(3)
Y-o-Y Growth
9k
27,479k
Jul-15 Dec-15 May-16 Oct-16 Mar-17 Aug-17 Jan-18
Unique Addresses Growth (000’s) (1)
3k
364,595k
Jan-09 Jul-10 Jan-12 Jul-13 Jan-15 Jul-16 Jan-18
2418%Y-o-Y Growth
50%
2 Y
ea
r G
row
th
222%
2 Y
ea
r G
row
th
deVere Adventurous Digital Asset Fund SP 18
There are ~1,500 Cryptocurrencies Circulating Worldwide
Currently
Note: Price, Current Market Cap and 24-hr Volume as of Feb 25, 2018
Launch Dates: (1) Bitcoin Cash: Jul 23, 2017; (2) Cardano: Oct 2, 2017; (3) IOTA: Jun 13, 2017; (4) EOS: Jul 4, 2017
As of Feb 25, 2018 the top 12 cryptocurrencies represented ~83% of the total Cryptocurrency Market Capitalization with Bitcoin
(oldest cryptocurrency) alone accounting for ~38% followed by Ethereum with ~19% market capitalization
Founded Year: 2009
Price: $9,664.7 (∆ y-o-y 8x)
Current Market Cap: $165,407Mn
24-hr Volume: $5,706Mn
Founded Year: 2014
Price: $281.02 (∆ y-o-y 24x)
Current Market Cap: $4,303Mn
24-hr Volume: $34Mn
Founded Year: 2011
Price: $220.5 (∆ y-o-y 58x)
Current Market Cap: $11,524Mn
24-hr Volume: $1,028Mn
Founded Year: 2015
Price: $844.8 (∆ y-o-y 62x)
Current Market Cap: $82,119Mn
24-hr Volume: $ 1,646 Mn
Founded Year: 2012
Price: $0.94(∆ y-o-y 167x)
Current Market Cap: $37,217Mn
24-hr Volume: $360Mn
Founded Year: 2017
Price: $1.82 (∆ since launch(3) 3x)
Current Market Cap: $4,917Mn
24-hr Volume: $104Mn
Dec’14$8.5Bn$4.9Bn
Founded Year: 2014
Price: $591.7 (∆ y-o-y 22x)
Current Market Cap: $4,699Mn
24-hr Volume: $71Mn
Founded Year: 2016
Price: $118.5 (∆ y-o-y 1034x)
Current Market Cap: $7,689Mn
24-hr Volume: $115Mn
Founded Year: 2017
Price: $1,178.1 (∆ since launch(1) 3x)
Current Market Cap: $20,236Mn
24-hr Volume: $363Mn
Founded Year: 2017
Price: $0.34 (∆ since launch(2) 17x)
Current Market Cap: $8,352Mn
24-hr Volume: $247Mn
Founded Year: 2014
Price: $0.36 (∆ y-o-y 190x)
Current Market Cap: $6,548Mn
24-hr Volume: $42Mn
Founded Year: 2017
Price: $7.9 (∆ since launch(4) 2x )
Current Market Cap: $5,647Mn
24-hr Volume: $174Mn
3 Bitcoin Emerging as
a New Asset Class
deVere Adventurous Digital Asset Fund SP 20
Bitcoin has Delivered Exceptional Absolute Returns vis-à-vis
Other Asset Classes
Cryptocurrencies provide a highly lucrative investment avenue to investors with returns significantly higher than
conventional high yield asset classes
1 Year
Return
Mar-17 Apr-17 May-17 Jun-17 Jul-17 Aug-17 Sep-17 Oct-17 Nov-17 Dec-17 Jan-18 Feb-18
Growth of Assumed $10,000 Investment in Major Asset Classes from Mar-17 to Feb-18
Historical Returns Bitcoin vs. Major Asset Classes (1)
8.2x
1.3x
1.2x
1.0x
1.2x
1.1x
Bitcoin US Equities Emerging Market Equities U.S. Bonds Oil Gold
All data as of Feb 25, 2018
Note: (1) S&P 500 has been taken as proxy for US Equities, Bovespa for Emerging Market Equities, iShares Barclays Aggregate Bond ETF (AGG) for US Bonds.
Sources: Coinmarketcap, investing.com
10k
164k
83k
22.77x
40.70x
17.94x
1.41x 1.30x 1.49x2.08x
1.68x 1.87x
0.97x 0.96x 0.99x
1.92x
1.250.62
1.07x 1.11x 0.99x
2 Year Return 3 Year Return 4 Year Return
Bitcoin US Equities Emerging Market Equities US Bonds Oil Gold
deVere Adventurous Digital Asset Fund SP 21
Also Provides Substantial Portfolio Diversification Benefit
By virtue of low correlation with major asset classes, Bitcoin has the potential to balance the risk of a portfolio; based on
last 2 year data, Bitcoin’s average 6 month rolling correlation with other asset classes is less than 0.6
Correlation (1) : Bitcoin vs. Major Asset Classes (2)
0.57
0.09
0.340.42
0.28
U.S.Equities
U.S. FixedIncome
Gold Oil Bitcoin
Emerging Market Equities
0.57
0.05
0.16
0.32
0.58
EmergingMarketEquities
US FixedIncome
Gold Oil Bitcoin
US Equities
0.05 0.09
0.74
-0.190.11
USEquities
EmergingMarketEquities
Gold Oil Bitcoin
US Fixed Income
0.320.42
-0.19
-0.05
0.19
USEquities
EmergingMarketEquities
US FixedIncome
Gold Bitcoin
Oil
0.160.34
0.74
-0.05
0.17
US Equities EmergingMarketEquities
US FixedIncome
Oil Bitcoin
Gold
All data as of Feb 25, 2018
Note: (1) Correlation has been calculated on a 6-month rolling basis over a period of 2 years, (2) S&P 500 has been taken as proxy for US Equities, Bovespa for Emerging Market Equities, iShares Barclays
Aggregate Bond ETF (AGG) for US Bonds; Sources: Coinmarketcap, investing.com
deVere Adventurous Digital Asset Fund SP 22
8.8%
1.4%2.9%
0.4%
3.9%
1.8%
8.6%
1.4%2.8%
0.4%
4.2%
1.8%
9.7%
1.1%2.6%
0.4%
3.9%
1.7%
13.8%
1.0%2.2%
0.4%
3.5%
1.5%
Bitcoin US Equities Emerging MarketEquities
US Bonds Oil Gold
Last 4 Years Last 3 Years Last 2 Years One Year
Volatility of Weekly Returns Bitcoin vs. Major Asset Classes (%) (1) (2)
Jun-13 Dec-13 Jun-14 Dec-14 Jun-15 Dec-15 Jun-16 Dec-16 Jun-17 Dec-17
30-Day BTC/USD Volatility 60-Day BTC/USD Volatility
The decline in bitcoin’s volatility has been a result of:
» More stable and liquid spot exchanges
» Greater regulatory clarity
» Broader ownership
» Increasingly reliable price discovery data.
Bitcoin’s Volatility, although decreasing, is still high
compared to other assets
The Fund’s strategy enables its trading team to benefit directly from this volatility and potentially generate Alpha during
turbulent price movements
Bitcoin Price Volatility (%)
All data as of Feb 25, 2018
Note: (1) Weekly volatility has been calculated on a 4-week rolling basis and averaged over respective time periods. (2) S&P 500 has been taken as proxy for US Equities, Bovespa for Emerging Market
Equities, iShares Barclays Aggregate Bond ETF (AGG) for US Bonds; Sources: Coinmarketcap, investing.com
13%
7%
deVere Adventurous Digital Asset Fund SP 23
2.40
1.421.51
-1.12
0.68
0.45
2.18
1.75 1.77
-0.70
1.21
0.34
1.94
0.760.86
-0.50
0.380.27
1.26
0.880.75
-0.18 -0.20
0.05
Bitcoin US Equities Emerging Market Equities US Bonds Oil Gold
1 Year 2 Year 3 Year 4 Year
However it still Offers Superior Risk Adjusted Returns
Bitcoin’s high volatility has been compensated by even higher returns resulting in superior return per unit of volatility (as
expressed by Sharpe Ratio) when compared to other asset classes
Sharpe Ratio: Bitcoin vs. Other Asset Classes(1) (2)
All data as of Feb 25, 2018
Note: (1)Sharpe ratio calculated using weekly data and the 3 month US T-Bill as the risk-free rate of return (2) S&P 500 has been taken as proxy for US Equities, Bovespa for Emerging Market Equities,
iShares Barclays Aggregate Bond ETF (AGG) for US Bonds.
4 Road Ahead for
Cryptocurrencies
deVere Adventurous Digital Asset Fund SP 25
Cryptocurrencies have a Range of Possible Future
Scenarios
Adoption across industries and geographies is the key factor that will determine the future of cryptocurrencies. It would
be interesting to see whether cryptocurrencies revolutionizes industries and interaction systems globally or fizzles out
Probable Future Scenarios
» Cryptocurrencies fail to
generate mass adoption as
technology acts as a
handicap and is unable to
garner public trust
» Used only by enthusiasts
and technology evangelists
» Strict regulations that
reduces the scope of use
» Used by organizations for
B2B and institutional
transactions
» Regulations squeeze out
prospects for use as currency
» Blockchain by virtue of its
numerous use cases is
adopted across industries for
maintaining records &
supplementing automated
decision making systems
» Becomes the de facto standard
for all financial transactions
(payments, accounts, securities)
» Kills message based systems &
undermines central banks
» Becomes the “global anchor”
currency
» Need for a borderless
currency drives mass
adoption across the globe
» Concept of decentralized
currency outgrows
Blockchain and is processed
on traditional systems
1 2 3 4 5
Grows into a fad
Remains a niche
payment Instrument
Blockchain technology
adopted; currencies
discarded
Currencies adopted;
blockchain technology
discarded
Revolutionizes the
interaction systems and
value exchange
instruments across the
globe
Notable Currencies The Game Changer
?
deVere Adventurous Digital Asset Fund SP 26
Residential
ApartmentsWorkplace Supermarket Bank Logistics Services Manufacturing
Power
GenerationHealthcare
»Automated rent collection and tax payments
»Smart contracts could ensure maintenance & new contracts are awarded to companies with requisite experience
»Efficient maintenance, accessibility & validation of HR records
»Smart contracts will allow productivity based remuneration structures & salary remittance for micro periods
»Elimination of the counterfeit market via supply chain tracking
»Smart contracts could promote localized consumption through use of differential pricing, thereby reducing carbon emissions
»Replace message based communication resulting in shorter settlement time
»Transform records maintenance systems, improve efficiency & reduce admin costs
»Ease out cross border remittance process
»Increased product transparency across supply chain
»Automated management of inventory, raw materials, invoice generation & settlement, resulting in increased efficiency
»Help providers to predict requirements, identify & solve problem cases based on user interaction patterns on the block chain
»Allow consumers to automate regular requirements or set conditions that automatically trigger requests
»Supply chain tracking to allow improved control over product quality
»Post production & sale tracking to help manufacturers get insights on usage patterns, allowing them to modify product design to suit different sets of customers
»Facilitate P2P energy trading, reducing transmission losses
»Increase efficiency of existing processes, “smart grid” management systems that automatically diagnose network emergencies & reconfigure them
»Smart contracts can ensure that appropriate parties are notified of noncompliant events in real time
»Help patients determine out-of-pocket costs before they select providers or undergo treatments
Government Regulations would play a major role on the speed of blockchain and cryptocurrency adoption; In recent years a growing number of countries have
realized that limited regulation of the use of cryptocurrencies is beneficial in the long run over extreme bans on its use
A Cryptocurrency’s Success would be Determined by the
Number of Use Cases its Blockchain supports
Cryptocurrency utility and value is directly proportional to an increase Blockchain usage; Given its innumerable use
cases, blockchain technology shows huge promise in replacing the current legacy systems
5 Appendix: Currency
Profiles
deVere Adventurous Digital Asset Fund SP 28
Currency Snapshot - Bitcoin
$21 $46 $14 $45 $46$139
$99
$860
$12,136
$5,707$754 $640 $320 $263 $431$673
$964
$2,481
$13,170
$9,790
31-Dec-13 30-Jun-14 31-Dec-14 30-Jun-16 31-Dec-15 30-Jun-16 31-Dec-16 30-Jun-17 31-Dec-17 25-Feb-18
Volume ($Mn) Market Cap ($Bn) Price ($)
» Date of Launch: 2009
» Founder(s): Satoshi Nakamoto
» Use Case: Peer-to-peer electronic cash
system
» Forked From: Written From Scratch
» Consensus Mechanism: Proof-of-Work
Historical Price ($), Volume 24hr.($Mn) and Market Capitalization ($Bn) Key Facts
Transaction
Time (s)
600
Block
Reward
12.5
Max Coins
21Mn
Transactions
per day
206k
Sources: Coinmarketcap, cryptocompare.cc, blockchain.info
9.3 41.77.8 4.2 3.7 6.4 10.1 15.4 229 165
deVere Adventurous Digital Asset Fund SP 29
Currency Snapshot - Ethereum
$1 $16 $9
$1,012
$2,554
$1,646
$1 $12 $8
$295
$713
$844
31-Dec-15 30-Jun-16 31-Dec-16 30-Jun-17 31-Dec-17 25-Feb-18
Volume ($Mn) Market Cap ($Bn) Price ($)
» Date of Launch: 2015
» Founder(s): Vitalik Buterin, Mihai Alisie,
Anthony Di Iorio, and Charles Hoskinson
» Use Case: Decentralized platform for
applications
» Forked From: Written From Scratch
» Consensus Mechanism: Proof-of-Work
(to migrate to Proof-of-stake)
Historical Price ($), Volume 24hr.($Mn) and Market Capitalization ($Bn) Key Facts
Transaction
Time (s)
17
Block
Reward
5
Max Coins
(Every Year)
18Mn
Transactions
per day
73k
Sources: Coinmarketcap, cryptocompare.cc, etherscan.io
0.1 28.21.0 0.7 69 82.5
deVere Adventurous Digital Asset Fund SP 30
Currency Snapshot - Ripple
Sources: Coinmarketcap, cryptocompare.cc
» Date of Launch: 2012
» Founder(s): Arthur Britto, David
Schwartz, Ryan Fugger
» Use Case: International payments by
banks and financial institutions
» Forked From: Written From Scratch
» Consensus Mechanism: Proof-of-Work
Historical Price ($), Volume 24hr.($Mn) and Market Capitalization ($Bn) Key Facts
Transaction
Time (s)
4
Block
Reward
NA
Max Coins
100Bn
Transactions
per day
62K
0.2 10.20.0 0.7 0.4 0.2 0.2 81.10.2 37.2
$0.1 $0.0 $0.6 $1.0 $0.4 $1.0 $0.3$67.8
$4642.0
$360.2$0.027 $0.004 $0.024 $0.011 $0.006 $0.007
$0.006 $0.263
$2.100
$0.900
-$0.9
-$0.4
$0.1
$0.6
$1.1
$1.6
$2.1
31-Dec-13 30-Jun-14 31-Dec-14 30-Jun-15 31-Dec-15 30-Jun-16 31-Dec-16 30-Jun-17 31-Dec-17 25-Feb-18
Volume ($Mn) Market Cap ($Bn) Price ($)
deVere Adventurous Digital Asset Fund SP 31
Currency Snapshot –Bitcoin Cash
Sources: Coinmarketcap, cryptocompare.cc, BitinfoCharts.com
» Date of Launch: 2017
» Founder(s): Satoshi Nakamoto
» Use Case: Peer-to-Peer electronic cash
» Forked From: Bitcoin
» Consensus Mechanism: Proof-of-Work
Historical Price ($), Volume 24hr.($Mn) and Market Capitalization ($Bn) Key Facts
Transaction
Time (s)
600 12.5
Max Coins
21Mn
Transactions
per day
33k
- 9.5 7.2 7.5
$0
$298
$151
$344
$1,211$1,300
$363
$346
$576$437
$449
$1,380
$2,377
$1,192
31-Jul-17 31-Aug-17 30-Sep-17 31-Oct-17 30-Nov-17 31-Dec-17 25-Feb-18
Volume ($Mn) Market Cap ($Bn) Price ($)
23.3 40.1 20.3
Block
Reward
deVere Adventurous Digital Asset Fund SP 32
Currency Snapshot - Litecoin
Sources: Coinmarketcap, cryptocompare.cc
$7 $4 $2$15
$3 $3$9
$251
$771
$1029
$24$9 $3 $4 $4 $4 $4
$40
$217 $209
31-Dec-13 30-Jun-14 31-Dec-14 30-Jun-15 31-Dec-15 30-Jun-16 31-Dec-16 30-Jun-17 31-Dec-17 25-Feb-18
Volume ($Mn) Market Cap ($Bn) Price ($)
» Date of Launch: 2011
» Founder(s): Charlie Lee
» Use Case: Smaller Faster Transactions
» Forked From: Bitcoin
» Consensus Mechanism: Proof-of-Work
Historical Price ($), Volume 24hr.($Mn) and Market Capitalization ($Bn) Key Facts
Transaction
Time (s)
150
Block
Reward
25
Max Coins
84Mn
Transactions
per day
42k
0.6 2.10.3 0.1 0.2 0.2 0.2 0.2 12 11.5
deVere Adventurous Digital Asset Fund SP 33
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