In the last three weeks we have seen why Sovereign Funds are the kings in the financial system, how the lack of regulation and other barriers are slowing their entrance into the market and which investment strategies they use. We have enough fundamentals to observe that the entrance of Sovereign Funds into crypto is inevitable. The impact of this entrance into the market can be huge. What we have to ask ourselves then is: are we ready for it?
Let’s take a look into a resume of conclusions:
- Sovereign funds (SIF) are the most important players in the financial system, they manage 30T in assets. (see who are them here LINK)
- SIF are not yet into crypto. (see why not here LINK)
- Security and legislation are crucial for SIF investments.
- Belobaba is the first fund regulated in the USA and Europe.
- SIF has evolved from investing in funds of funds, to more direct investments into companies.
- SIF needs more managing skills as they go deeper into the direct investments, but they have no experience to select, invest or manage in crypto projects.
- Belobaba has the expertise to understand the technological behavior of crypto projects and the financial requirements of the finance sector.
- SIF are looking for Unicorns.
- Crypto market is the biggest investment marketplace for startups in history.
- SIF has a long term view.
- Blockchain technology is an infrastructure of innovation, the basis where tech companies that will lead the market in the next decades will be supported.
- SIF looks for returns, but also for economic transformation.
Sooner than later, Sovereign Funds will start investing looking for the next unicorns into the crypto market. They are only waiting for the right time. But once the first clear movements arrive, a race between them will happen, as we’ve seen before in strategic energy investment for example.
Sometimes we need to open our vision, raise our eyes from the trading graphs, forget about the actual price and take a look into the big picture. Sovereign funds into crypto are like the movement of tectonique plaques. Movements that are so big that are impossible to contend. Those are very slow movements, very hard to observe, but suddenly, like an earthquake, they finally impact a concrete sector of the economy (Uber, Airbnb, Amazon, …).
Are we prepared for it?
Bitcoin is the money revolution, Decentralized Finance (DeFi) is the financial revolution and Web3 is the Internet Revolution.
Yours in crypto