Multicoin Capital’s Hedge Fund Lost 91.4% Last Year, Investor Letter Reveals
The fund’s performance was severely impacted by direct exposure to now-bankrupt crypto exchange FTX and holdings in FTT and Solana-based tokens.
“While the fund successfully dodged the catastrophic implosions of LUNA and Three Arrows Capital earlier in the year, we didn’t avoid the explosive revelations about FTX nor the subsequent contagion that spread across the market,” said the letter. “After a remarkable year in 2021, our performance in 2022 was the worst since inception.”
Third time unlucky!
However,
Multicoin reported that the fund gained 100.9% in January 2023, bringing the fund’s inception-to-January return to 2,866%.
Inception was October 2017. Bitcoin price then was about $4k (currently up 450%), ETH was about $300 (currently up 430%); not so bad, then, despite a horrendous 2022.
A reminder of some very basic mathematics. If you lose 90%, then in order to get back to where you were, you then need to make 900% on your remaining assets.
Would have to dig deeper to see where the 91% losses came from - coz that's a LOT of shitty FTX exposure!! especially after dodging 3AC and LUNA.