Adela Investment
Mining | Trading | Digital Asset Management
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News

Announcements and Updates

Recent Member Commentary

We truly want to thank you for being an investor in the fund and for the opportunity to serve you. We work hard each day to safeguard your assets, research developments in the space, and earn your trust.

If there’s ever a way we can be helpful, share latest data, or if you have feedback on things we could be doing to better serve you, or if you’d like to provide input on new products, please feel free to reach out via subject: Investor Relations AT info@adelainvestment.com

Many improvements to the fund have been implemented to the fund over the last update.

  • Expansion of Personal, and Operations to West Coast, and Europe;

  • Mining Operation Expansion;
    Second Upgrade from Ether mines to new Bitcoin miners

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With the competitor’s crypto index offerings down, Adela’s actively managed diversified strategy continues to reduce volatility and outperform the competition.

Crypto Prices In September: The Wide Dispersion Of Returns

The Adela’s Investment Fund ended the month of September largely flat, falling -14.83%. That performance, however, masked a wide dispersion in returns between different cryptoassets, and included the setup of Bitcoin miners.

Whilst a negative performance is always disappointing, the Funds’ performance so far this year places Adela’s Investment Fund amongst the top performing crypto focused funds, beating the average crypto fund manager by a sizeable margin too (beating the Eurekahedge Crypto Currency hedge index and Barclay Cryptocurrency trader index are down 51.1% and 48.0% as of end of August - based on data available as at September 27th). In fact, Adela’s Fund continues to outperform all major crypto currencies in 2018.

Three of the 160 cryptoassets in the fund posted positive returns, with XRP (Ripple) rising an astonishing 71.23% for the month. Lumens (Stellar) also posted a strong return, rising 16.42%, while Monero just tripped into positive territory with a 0.48% return. However when considering the prior 83% drop incurred by XRP year-to-date by August, one cannot help thinking that diversification remains a key element of crypto investing, just as for other asset classes.

In terms of investment strategy, Adela’s Investment Fund increased temporarily its arbitrage exposure in Bitcoin. while Index tracking continues to be very underweighted (and will remain so for the foreseeable future - no rebalancing for now). At portfolio level, the short-term arbitrage strategy focused on Bitcoin has achieved positive returns since inception and September was no exception. One of the secondary Ethereum arbitrage strategies took more of a decline..Of the top seven cryptoassets falling for the month, Ethereum suffered the worst return, tumbling 18.25%, followed by Zcash, which fell 14.02%, and EOS, which closed down 11.37%. Bitcoin returned 6.35% for the month. (Detailed information on fund performance is available in our latest Fund Fact sheet .)

Crypto News Summary For September: The Quiet but Significant Infrastructure Progress

The month of September was relatively quiet but mostly positive in terms of developments in the crypto realm. We saw continued new entrants joining, new coins being launched, interesting M&A with large-cap public blockchains, a thorough report on exchanges from the New York Attorney General, and some fake news to top it all off. From our point of view, there was nothing landmark that happened during the month; instead, the slow drumbeat of progress continued, which is great.

The News of Interest In September: XRP’s Astonishing Rise

The biggest news in September was the sharp rise in Ripple’s XRP. Its aforementioned 71% rise actually undersells the significance of the asset’s move, since it started the month by falling sharply. But from a close at $0.2637 on September 11, XRP rose an astonishing 121% to close the month at $0.581572. Trading volume surged as well, with average daily trading volume jumping from roughly 270 million tokens to nearly 750 million tokens. It’s hard to attribute the movement of a cryptoasset to any one thing, but XRP’s dramatic rise in September appears to be driven primarily by Ripple’s cryptocurrency banking product, xRapid, was moving into commercial production. xRapid uses XRP to facilitate cross-border payments, an extremely large potential market for cryptoassets. Ripple says that xRapid can cut up to 60% off the cost of cross-border payments. Many people expect cross-border payments and international remittance to be the first place that cryptoassets find widespread use.

Crypto Reflexivity: 

A major new trend in the marketplace is for cash-rich crypto treasuries to put their money to work buying significant assets that boost the value of their cryptoasset.  Earlier this summer, Tron, currently the 12th largest cryptoasset, used part of its sizable Treasury holdings to purchase BitTorrent. The move gave Tron access to the largest decentralized computing platform in the world, with more than 170 million users. By any measure, the BitTorrent deal dramatically increased the likelihood that the Tron blockchain and its related cryptoasset, TRX, will emerge as systemically important. In September, Lightyear.io, the for-profit company associated with the Stellar blockchain (and its related cryptoasset, Lumens (XLM)), acquired Chain, the leading provider of private blockchains, for a reported $200 million. Stellar is emerging as a blockchain of choice for corporate use, and the deal with Chain solidifies that positioning. Chain is a four-year-old company that has raised over $40 million in venture capital financing and has built blockchain projects for Visa, Citigroup, Nasdaq, and others. The purchases are a reminder of the reflexivity of the crypto space. Lightyear.io was able to purchase Chain because people think the Stellar blockchain will be valuable in the future. Simultaneously, the purchase of Chain raises the likelihood that the Stellar blockchain will be valuable in the future.

Note: Adela Investment Fund methodology includes a subcommittee that addresses how we screen out exchanges that fall short of our quality standards, including those that facilitate wash-sale trading and other manipulative practices. Adela executes the majority of its trading activity in markets with established counterparties, and takes wide-ranging steps to protect customer assets. We continue to monitor the crypto exchange marketplace closely, and both expect and

look forward to its continued maturation. 


One micro-trend we are following is the rise of fake news (or maybe it’s just over-eager reporting) in the crypto community.   The crypto media ecosystem is young and imperfect. Whereas a major newsroom will require multiple points of confirmation before publishing a story, many crypto-specific media properties operate with a shoot-first-and-ask- questions-later attitude. 


The result is that stories get misreported on a regular basis. Case in point were two stories published in September.  First, there was the widely reported news that Goldman Sachs had halted plans to build a crypto trading desk. The community reacted to the news by sending cryptoasset prices tumbling, with most assets trading down 10-20% on the news. As it turned out, the news was simply untrue: Goldman never had a specific timeline for a trading desk,

and it continues to explore the space.  


If you ever hear of shocking news and want to know whether we think it’s true, just write us at info@adelainvestment.com and we’ll share any information we have.

Other News

There were a number of news developments speaking to the growing maturation of the cryptomarket:

- IBM announced the launch of World Wire using the Stellar blockchain. The new payment system uses the tagline: “Let’s clear and settle cross border payments in seconds – not days.”

- Morgan Stanley was said to be investigating the launch of potential bitcoin swap contracts, which would allow the firm to offer clients exposure to the price of bitcoin without the challenge of warehousing the actual asset.

- A number of firms—including Protocol Labs, Circle, Coinbase, and Polychain Capital—joined forces to form the Blockchain Association, which will lobby regulators for crypto-friendly policies.

- The crypto custodian BitGo received approval to act as a qualified custodian in the eyes of the Securities and Exchange Commission (SEC).  

- Bitmain officially filed for its long-rumored initial public offering. The firm—best known for designing and selling mining equipment—earned a first-half profit of $742 million on revenue of $2.8 billion.

- The Prime Minister of Malta gave an impassioned speech on the importance of cryptoassets and blockchain technology to the United Nations, calling cryptocurrencies the “inevitable future of money.”


There were a number of significant new cryptoassets that launched that we are monitoring:

- Tezos—a project that is much-beloved by crypto specialists—officially transitioned from its beta to its mainnet launch. We’ll now see if the asset (XZT), which features a unique approach to governance issues, can evolve in the wild.

-Circle—a Boston-based crypto giant backed by more than $135 million in venture capital financing—announced the launch of its own stablecoin, called USD Coin (or USDC). USDC will aim to be a fully regulated and, in the words of a Bloomberg article, “a  more grown up version of stablecoins” compared with first-generation stablecoins like Tether.

-Gemini—the multifaceted crypto-focused firm created by the Winklevoss brothers—got on the stablecoin bandwagon as well with the launch of the Gemini Dollar (GUSD). The coin is 100% backed by fiat collateral. t is regulated by the New York State Department of Financial Service and features reliable auditing.

-Not to be outdone, Paxos launched an NY-regulated, dollar stablecoin called the Paxos Standard (PAX). The coin will allow users of the itBit exchange or OTC desks to withdraw assets instantaneously rather than waiting for fiat settlement.  


Not all news was good news in crypto, of course:

-The Japanese crypto exchange ZAIF was hacked and $60 million in cryptoassets stolen, marking the second significant hack of a Japanese crypto exchange this year (Coincheck lost $520 million in NEM earlier this year). Of note, Japanese regulators had issued a “business improvement order” telling ZAIF to get its act together on security earlier this year, but apparently it was too little too late.

-ShapeShift, which made its name by allowing speculators to transform exposure in one cryptoasset into exposure to another, announced that it was abandoning a key feature of its service: the ability to interact with the service without an account. Going forward, you will have to register and provide information to transact with the platform. The move came two weeks before the release of a Wall Street Journal investigation linking ShapeShift to money-laundering activity. (ShapeShift has subsequently published a detailed debunking of The Wall Street Journal’s accusations).

-The SEC halted trading in depository receipts that allowed U.S. investors to access Swedish-listed Bitcoin and Ethereum ETNs, citing “confusion amongst market participants.” The move is consistent with the SEC’s resistance to allowing crypto ETFs to list.

-Developers revealed that there was a bug in the software for the Bitcoin blockchain, which could have allowed for unintentional double-spending and asset inflation in the crypto space.  

-In a great piece of original reporting, Reuters traveled to Venezuela to find evidence that someone there was using the Petro, the national cryptocurrency that is theoretically backed by oil. It found no evidence that it exists or that any locals had heard of it.


In other news:

-Coinbase, after years of limiting the number of cryptopassets it offers on its platform, announced a new program to facilitate the listing of a large number of additional cryptoassets. The optimist’s take is Coinbase is embracing the opportunities offered in alt-coins; the skeptical take is that Coinbase is facing declining trading volume in the five coins it currently lists, as well as rising competition from list-anything exchanges

like Binance, and is evolving to compete.

-Binance announced plans to launch a number of local crypto-to-fiat exchanges, including plans to launch three such exchanges in the next year. The fiat offramp is a critical feature for the crypto ecosystem, and this news reflects the continued maturation of Binance as a business.


Finally, there was a run of extremely bullish predictions about the future direction of crypto prices from legitimate experts in the space:

-Satis Group said (among other things) that bitcoin would rally to $96,000 inside five years

-Tim Draper suggested crypto will be an $80 trillion industry within 15 years

-Binance CEO Changpeng Zhao said crypto prices will grow 1000x

-Ex-hedge fund manager Mike Novogratz announced that Bitcoin had hit a technical bottom

-Fundstrat’s Thomas Lee said Ethereum will rally to $1,900 by year-end  

They are probably all too bullish, and in general we think it’s very hard to time the markets (and cryptomarkets in particular), but seeing several respected analysts and investors turning aggressively bullish at the same time is an interesting signal.

Final Thoughts

We truly want to thank you for being an investor in the fund and for the opportunity to serve you. We work hard each day to safeguard your assets, research developments in the space, and earn your trust.

If there’s ever a way we can be helpful, share latest data, or if you have feedback on things we could be doing to better serve you, or if you’d like to provide input on new products, please feel free to reach out via subject: Investor Relations AT info@adelainvestment.com