what we believe in
The emerging cryptocurrency asset class necessitates a nuanced investment approach. Cryptoassets are early-stage investments in internet-native companies, in which the value accrues to a liquid asset (a tradeable token) as opposed to illiquid equity. This nascent asset class therefore exhibits characteristics of both traditional venture capital and public equities. As such, these assets offer a unique investment profile that combines venture-style return with a shorter investment time horizon. Triton Liquid Fund adopts a fundamental and quantitative approach to investing in this space. We first assess a company's fundamentals through a venture capital lens, and then actively manage our portfolio using quantitative metrics, which we pull real-time from the blockchain and open-source code bases of these projects. We believe the basis of capital allocation in this space will ultimately revolve around these metrics.

Fundamental Assessment

For each investment, we conduct a ~20 page writeup that follows a formulaic template to assess the project's fundamentals. These are similar to deal memos in traditional VC. We then take this qualitative writeup and quantify each line item for 30 variables, such as team, business model, value accrual, etc. We view these as living documents, which we update on a quarterly basis as these early stage projects either grow and evolve or stagnate and die.

To-date we have done over 100 token write-ups across 20+ different verticals. Once we complete writeups for all tokens in a given vertical, we discuss the merits of each project as an investment committee.

Our Research

Quantitative Tracking and rebalancing

Unlike traditional VC or equity investments, where project information is often limited and financials are reported quarterly, blockchain-based projects offer a distinct advantage. They generate real-time data, readily available for near real-time analysis through a shared public ledger and opensource code base. We harness these data-driven insights to track activity in each vertical, for example – daily active users, new user growth, revenue, total value locked, etc. Whenever we detect sustained growth or contraction in fundamental metrics, we proactively reevaluate our strategic positioning within that vertical. Since our investments in these projects are liquid, we can rebalance our portfolio to stay aligned with the strongest projects in each category.



ECON 101 and Digital Assets
Jul 10, 2024

This market pain is to be expected. We are thrilled to see it. 

Narrations on the Market: Part II The Embedded Crypto Put
Jul 5, 2024

TGEs and airdrops allow founders and investors to exit projects earlier, even if they failed

Narrations on Recent Market Dynamics: Part I
Jun 27, 2024

Airdrop campaigns are a uniquely powerful mechanism, but only if used correctly

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