Tech Heavyweights entering into the game of cryptocurrency is another signal of the legitimization of the cryptocurrency movement.
The Founder of Techcrunch, Michael Arrington will be yet another whale that chooses to swim in the volatile crypto seas. He announced today at Consensus that he’s in the process of raising $100 million for a new hedge fund that will be purchasing and holding crypto assets, the fund will also make investments in token generation events while also holding some equities and debt instruments.
The entity will be titled Arrington XRP Capital, they state they will be first ones to make certain that all of their limited partners will have to have a certain amount of holdings in XRP. XRP is the fuel for Ripplenet, software created by San Francisco based Ripple. They are also planning on using the XRP currency for all of their distribution of returns as well as their fees.
The most interesting thing about the unveiling of this fund might possibly be that Michael, stressed the importance of how him stepping into this space is closing a previous chapter of his career and opening another one. The previous chapter was the launch and continual growth of TechCrunch, still one of the most prominent tech industry icons running. Within this time frame, he’s also founded CrunchFund, a VC fund that has more than 50 exits.
The founder reportedly mentioned at the Conference :
“In the last several months, I’ve gone from crypto enthusiast to 100 percent crypto. I’ve only been looking at crypto deals. This is what I think I’ll be doing the rest of my career.”
He is a big believer in the fact that cryptocurrency is just taking off and has yet to reach its bubble phase. He doesn’t think that $280+ Billion market is going to pop anytime soon and thinks that there is a larger growth pattern and much more further utilization in terms of value and potential asset classes that could emerge from the market.
“I seriously think that we’ll be in the trillions next year, and that we’ll start to see institutional money,” he stated. “I think next year you’ll see significant gains.”
He will also have other partners like Heather Harde and a few other partners that will serve potential investors with him on this firm’s roster.
How much, who and what does the fund have?
According to reports, the fund has raised about $50 Million in traditional currency and will be seeking to close the funding round by the end of this year.
The fund will be targeting a specific set of investors, those who have high exposure to the world of cryptocurrencies and understand the way that they will move in the markets. He is targeting those with a deep knowledge base. He doesn’t necessarily want to target the fair weather cryptocurrency enthusiasts who were drawn in by the rising prices of the pioneer currency, he wants to work with those who are in it for a longer time horizon.He’s targeting those that are interested in the fundamentals, those who are interested in the value and investing to raise it up, to further its applications and to impact various aspects of the way payments work in the world.
He’s looking to work with those people that are working with Mike Novogratz
It’s certainly not an easy path for these investors, they need to structure the fund in a way that fiat is converted into crytpo, this makes it where the hedge fund can operate and within the bounds of the law. These sorts of funds will have to initially go through through a lengthy approval process to meet regulatory concerns.
XRP is utilized for the reasons of increasing the efficacy of the hedge fund model by minimizing inherent issues.
The team over at Ripple are getting an added boost, validating their efforts even further by an external party.
“Arrington’s decision to solely use XRP to power his capital fund further validates that this digital currency provides the best use case for real-time, transparent and secure transactions.
In fact, not only does XRP provide much-needed liquidity for cross-border payments, it’s the fastest, most scalable and stable digital asset on the charts — making it the most appropriate for institutional use.
Even though Ripple does not play an official role in the fund, we are glad to see that Michael Arrington is using his legendary entrepreneurial spirit to create one of the largest digital currency hedge funds using XRP.”