According to Bloomberg, billionaire Steven Cohen through Cohen’s Private Ventures has recently invested in Autonomous Partners, a hedge fund focused on cryptocurrencies and digital assets. Autonomous Partners is currently led by Arianna Simpson, a strong advocate for cryptocurrencies and blockchain technology.
Autonomous Partners emerged in 2017 and has received investment from Union Square Ventures, Coinbase’s CEO Brian Armstrong, and Craft Ventures Co-founder David Sacks.
“I’ve only brought on partners that I think can be very much value-add beyond their capital,” said Simpson to Fortune.
Simpson believes that there is a lot of potential with the cryptocurrency industry, as companies in the cryptocurrency and blockchain sector are building out the next generation of financial infrastructure. While Autonomous Partners invests primarily in startups in the cryptocurrency industry, they also invest in popular cryptocurrencies like Bitcoin and Ethereum.
Autonomous Partners focuses on areas with a long-term need
Fortune reported that due to the uncertain nature of the cryptocurrency industry, Autonomous Partners is investing in companies and focusing on areas where there is a long-term need or demand that will outlast the unpredictable regulatory environment.
Autonomous Partners, however, does invest in some cryptocurrencies with a large market capitalization but has steered away from certain cryptocurrencies like the Ripple XRP token. When it comes to investing in well-known cryptocurrencies, Simpson stated to Fortune that she is “also looking at what is the next generation,” as investors can easily access the popular cryptocurrencies on their own.
As for startups, Simpson sees a lot of potential in cryptocurrency projects that can speed up financial transactions, startups that are building out financial infrastructure space, companies working on creating up-and-coming privacy coins which can anonymize ownership, and firms testing out different solutions to tackle the problem of blockchain scalability. An example of a project Simpson has invested in is 0x—a protocol designed to create decentralized exchanges.
“It’s still up in the air if people want to do a number of thing on the blockchain,” said Simpson. “We’re still figuring out what needs one and what doesn’t. But it’s clear they want to trade, and they want to play games.”
Autonomous Partners is concerned about Ripple’s Level of Centralization
While Simpson is bullish on the cryptocurrency sector in general, she has a lot of concerns about Ripple tokens. Ripple’s XRP tokens are currently the third-largest tokens by market capitalization, but Simpson is concerned that the Securities and Exchange Commission may see the XRP tokens as securities. If XRP is labeled as securities, it would subject the company to stricter laws. Furthermore, most of the Ripple tokens are owned by Ripple.
“I have a lot of concerns about the level of centralization there, and I have regulatory concerns if what they have issued is a security,” said Simpson.
Multicoin Capital, another cryptocurrency hedge fund also shares similar concerns over Ripple’s XRP token.
Ripple, however, has argued that their tokens do not fall under existing securities law.
“I don’t think that our ownership of XRP gives us control,” said Brad Garlinghouse, the CEO of Ripple. “Saudi Arabia owns a lot of oil – that doesn’t give them control of oil.”
Although there’s a lot of confusion and uncertainty in the space, Simpson is confidence that blockchain technology will prosper in the long run. She acknowledges, however, that “the whole space is still waiting for a bit more clarity.”
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