Dear Investor,

 

The first quarter of 2024 ended on a high note for crypto assets, with the Nasdaq Crypto Index (NCI) up over 63%. The bull market has clearly arrived. 

ETF inflows have been driving much of bitcoin’s strong outperformance this year, but there are several other factors strengthening its investment case. Macro conditions and the upcoming halving may drive near-term prices, but Samir Kerbage covers the other longer-term factors that are making the case for bitcoin in his latest Notes from the CIO.  

Our research analyst Lucas Santana also wrote an article about the impact of recent monetary shocks to bitcoin’s correlation to other asset classes, and how these events have impacted bitcoin’s role as a portfolio diversification tool. You can read that article here. 

 

As always, we are greatly appreciative of your trust in us and are here to answer any questions you may have.  

 

-Your Partners at Hashdex 

 

 

Market Review

March was a positive month for risk assets, with the S&P 500 and Nasdaq 100 indices rising 3.2% and 1.2%, respectively. However, the most notable event was bitcoin hitting another all-time high. After closing February at $61,000, bitcoin (BTC) needed a rise of just under 15% to surpass the high recorded in November 2021, and it took 11 days to do so.

After staying predominantly above $70,000 for two days and reaching a new high beyond $73,400, BTC began declining before falling below $63,000. However, starting from the 25th, bitcoin recovered and closed March above $71,000. Bitcoin and the Nasdaq Crypto Index (NCI) saw gains of 15.4% and 12.7%, respectively, marking the seventh consecutive positive month.

Other indices that serve as benchmarks for products managed by Hashdex also saw gains. Among the sectoral indices of CF Benchmarks, the main highlight was Digital Culture, which rose by 37.7%, driven by its most heavily weighted asset, Shiba Inu, which surged an incredible 128%. Decentralized Finance (DeFi) and Smart Contracts Platforms indices rose by 15.1% and 17.8%, respectively. The Vinter Hashdex Risk Parity Momentum Index appreciated by 10.4%.

Through March, the NCI rose 63.4%. The excellent first quarter of performance has gotten this most recent bull market off to a strong start, and we remain extremely confident in the digital asset class in the medium and long term.

 

 

Top Stories

World’s largest pension fund explores bitcoin as an investment

Japan's Government Pension Investment Fund (GPIF) is considering potential new investments, including bitcoin, seeking information on the impact of bitcoin’s integration into portfolios, as Japan explores legislation to embrace digital assets. This move highlights a growing recognition of the potential benefits they may offer to institutional portfolios.

 

London Stock Exchange will start market for bitcoin and ether ETNs

The London Stock Exchange plans to roll out BTC and ETH exchange-traded notes for professional investors on May 28. The announcement aligns with ongoing efforts to establish the UK as a more crypto-friendly hub.

 

Ethereum finalizes 'Dencun' upgrade to reduce second layer fees 

Ethereum successfully implemented its long-awaited Dencun upgrade, marking a pivotal moment in the network’s broadband phase. A key aspect of this upgrade is the introduction of "blobs," a novel data storage solution aimed at significantly reducing transaction fees on Layer-2 networks and bolster Ethereum's scalability. The Hashdex research team shares their views on why it matters for investors here.

 

Goldman Sachs and other prominent firms continue work on tokenizing assets

Blockchain provider Digital Asset recently conducted an important trial of its Canton Network, collaborating with several large, traditional financial institutions. This innovative blockchain service facilitated seamless transactions and settlements of tokenized assets, showcasing its versatility from fund registry to margin management.

 

_____________________________________________________________

_{This material expresses Hashdex Asset Management Ltd. and its subsidiaries and affiliates (“Hashdex”)'s opinion for informational purposes only and does not consider the investment objectives, financial situation or individual needs of one or a particular group of investors. We recommend consulting specialized professionals for investment decisions. Investors are advised to carefully read the prospectus or regulations before investing their funds. The information and conclusions contained in this material may be changed at any time, without prior notice. Nothing contained herein constitutes an offer, solicitation or recommendation regarding any investment management product or service. This information is not directed at or intended for distribution to or use by any person or entity located in any jurisdiction where such distribution, publication, availability or use would be contrary to applicable law or regulation or which would subject Hashdex to any registration or licensing requirements within such jurisdiction. No part of this material may be (i) copied, photocopied or duplicated in any form by any means or (ii) redistributed without the prior written consent of Hashdex. By receiving or reviewing this material, you agree that this material is confidential intellectual property of Hashdex and that you will not directly or indirectly copy, modify, recast, publish or redistribute this material and the information therein, in whole or in part, or otherwise make any commercial use of this material without Hashdex’s prior written consent.} 

 

_{Investment in any investment vehicle and cryptoassets is highly speculative and is not intended as a complete investment program. It is designed only for sophisticated persons who can bear the economic risk of the loss of their entire investment and who have limited need for liquidity in their investment. There can be no assurance that the investment vehicles will achieve its investment objective or return any capital. No guarantee or representation is made that Hashdex’s investment strategy, including, without limitation, its business and investment objectives, diversification strategies or risk monitoring goals, will be successful, and investment results may vary substantially over time. Nothing herein is intended to imply that the Hashdex s investment methodology or that investing any of the protocols or tokens listed in the Information may be considered “conservative,” “safe,” “risk free,” or “risk averse.”}

 

_{Certain information contained herein (including financial information) has been obtained from published and non-published sources. Such information has not been independently verified by Hashdex, and Hashdex does not assume responsibility for the accuracy of such information. Hashdex does not provide tax, accounting or legal advice. Certain information contained herein constitutes forward-looking statements, which can be identified by the use of terms such as “may,” “will,” “should,” “expect,” “anticipate,” “project,” “estimate,” “intend,” “continue”  “believe” (or the negatives thereof) or other variations thereof. Due to various risks and uncertainties, including those discussed above, actual events or results, the ultimate business or activities of Hashdex and its investment vehicles or the actual performance of Hashdex, its investment vehicles, or digital tokens may differ materially from those reflected or contemplated in such forward-looking statements. As a result, investors should not rely on such forward- looking statements in making their investment decisions. None of the information contained herein has been filed with the U.S. Securities and Exchange Commission or any other governmental or self-regulatory authority. No governmental authority has opined on the merits of Hashdex’s investment vehicles or the adequacy of the information contained herein.}

 

_{Nasdaq®, Nasdaq Crypto IndexTM, NCITM, Nasdaq Crypto Index EuropeTM, NCIETM are registered trademarks of Nasdaq, Inc. (which with its affiliates is referred to as the “Corporations”) and are licensed for use by Hashdex Asset Management Ltd. The Hashdex Nasdaq Crypto Index Europe ETP (the Product) have not been passed on by the Corporations as to their legality or suitability. The Product is not issued, endorsed, sold, or promoted by the Corporations. THE CORPORATIONS MAKE NO WARRANTIES AND BEAR NO LIABILITY WITH RESPECT TO THE PRODUCT.}