The Good News
Countinghouse is bringing a cryptocurrency hedge fund to the masses by tokenizing units of the investment fund. Countinghouse is using the blockchain as a ledger to record ownership of the fund among the token-holders.
What Is A Hedge Fund?
Hedge funds are investment pools that utilize customized strategies to attempt to gain profit from the underlying investments. In general hedge funds make riskier yet calculated investments with the idea that high risk can equal high reward.
In general hedge funds are accessible to high wealth individuals commonly known as Profession Investors in Australia and Hong Kong, Institutional Investors in Singapore, and Accredited Investors in the U.S. These investors accreditations are attained by having provable assets that allow them to mitigate any losses they occur.
Because a hedge fund is a private investment they often employ riskier strategies such as arbitrage, leverage, or algorithmic trading but in return, they aim to have positive returns regardless of market conditions.
Hedge Fund For All
Countinghouse is a take a unique approach to the hedge fund by opening it investors of all types. By tokenizing the units of the fund, using CHT tokens, individuals can purchase small portions of the fund for any period of time they choose.
Tokenizing the fund also allows individuals to trade their portion of the fund with others, on exchanges, or with the Countinghouse team (more on this later).
The team is allowing those with any level of wealth to participate in the fund. In this way, Countinghouse is very different since it is not limited to high wealth investors.
Does This Pay Dividends?
No, it doesn't, the token only represents ownership in the fund and its underlying investments. If you are wondering what happens to profits, don't worry I was too. I'll use an example based on answers from the team to explain how the fund going up in value can work for token holders.
If Bob owns 100 CHT and the Countinghouse Fund is currently valued at $100 his tokens are worth $1 each.
If the Fund increases in value to $1000 the tokens should theoretically be worth $10 each. In reality, the tokens are only representing ownership of the fund and have no value onto themselves. Exchange prices are purely speculative and can be greater or less than the $10 liquid price.
Countinghouse thought of these scenarios and created a buyback program. The fund will buy back any available tokens if the market drops below liquidity value as it is instant profit for the fund. This creates an effective price floor. You can then sell them directly to the fund at liquidity value if you wanted to. Also, when the fund buys them back, they won’t re-release the tokens.
Continuing with the example, Bob's CHT tokens can be sold back to Countinghouse for $1000 which is the liquid value.
The Countinghouse team will provide weekly reports to the public that detail the funds underlying liquid value.
What Makes Countinghouse Different?
Countinghouse already operates a FOREX hedge fund that uses coded algorithms and mathematical techniques with success. The team has tested their methods on the crypto markets for the past 12 months before creating the crypto fund.
Countinghouse will use the money from their token sale (private and public) to create the cryptocurrency fund that will utilize similar algorithms and code to invest. Investors in the FOREX (non tokenized) fund have already purchased enough tokens in the crypto fund to make it reach soft cap.
The fund will allocate 60% of the money raised into cryptocurrency algorithmic trading, 30% into double-sided cryptocurrency arbitrage, and 10% into a passive reserve. Because 90% of the infrastructure required to run the fund already exists due to the FOREX fund, the team is only taking accepting 1% of the total allocation of tokens.
In lieu of a large team allocation, the Countinghouse platform will collect a 7% commission from profits monthly (only profitable months).
For More Information on Countinghouse
📅Token Sale Dates: June 12
📈Token Ticker: CHT
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The buyback program is a great alternative to dividends. I'm interested in seeing what the weekly reports look like.
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Saw from your other reply that you skipped the token sale. I'm really curious how the liquidity value will work as well.
Their choice to go with increasing the NAV vs rewards (like Sharpe Capital) was questionable to many people but really it's the norm for hedge funds.
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