Arthur Hayes’ Maelstrom Exec Exposes 44% Loss in Top Crypto VC Bet Even as BTC Doubles
A Maelstrom director revealed a $100k crypto VC investment lost 44% value over four years despite Bitcoin doubling and seed deals yielding up to 75x returns.Summary
Akshat, the investment director at Arthur Hayes' Maelstrom, disclosed that a $100,000 investment made four years prior into an early-stage token venture capital fund had diminished to $56,000, representing a 44% loss. This poor performance occurred while Bitcoin doubled in value and many seed-stage investments returned 20 to 75 times the initial capital, leading to intense scrutiny over VC fund performance and fee structures (3% management fees and 30% carry).
Akshat suggested the fund's underperformance was due to large venture funds chasing a limited number of successful projects. He also noted the fund switched its reporting method to period-over-period change rather than since-inception returns, which he argued can obscure sustained losses. Market speculation suggested the fund in question might be Pantera Capital’s Early-Stage Token Fund.
This disclosure coincides with Maelstrom pivoting its strategy, launching Maelstrom Equity Fund I, a private equity fund focused on profitable, off-chain 'picks and shovels' businesses in the crypto industry, moving away from speculative tokens. This shift reflects broader Limited Partner dissatisfaction with traditional crypto VC models, especially concerning fees during market volatility.
(Source：BeInCrypto)