Video Of The Week: Polychain

Late last year, USV funded a new hedge fund called Polychain Capital, which invests only in crypto-assets.

I talked about the reasons for that investment in this blog post.

In the video of the week, Polychain founder Olaf Carlson-Wee talks about his belief in crypto assets and how he developed it.


Comments (Archived):

  1. Joe Lazarus

    Are there options for individuals to make small to mid sized investments in crypto portfolio funds managed by knowledgeable people like Olaf?

      1. Greg Kieser

        I don’t know… down .22% over the past 24 hours. Crazy volatility.

        1. jason wright

          i misread that. i thought it said 22%, and that is possible in crypto. that’s the risk, but also the attraction.for those looking for major gains volatility is the ‘atomic unit’ of crypto investing.

      2. Joe Lazarus

        Excellent. Just what I was looking for. Is Iconomi the best place to find and compare crypto funds?

        1. jason wright

          Taas. not mine, and all the more reason to consider it 🙂

        2. William Mougayar

          They started early and have a head start. Certainly the variety is there. But it’s just for funds that run on their platform.

      3. awaldstein

        To be clear, your fund as last look is not available in the US.So the vast majority of AVC readers can’t use it–correct?

        1. William Mougayar

          Correct, but it might be, later

          1. awaldstein

            One question, one comment.Are there any index funds that people in NY or the US (not always the same) can invest through? If you have no timetable, you should have no issue in sharing.AndIn my opinion, the majority of ICOs that will have useable apps earlier are around the ease of investing cross coins (still not simple) rather than apps that are disrupting the status quo.Snake eating its tail if you will.So in a year the opportunities for the lay investor will be far greater then examples of communities and behaviors that have developed proof points of this general decentralized incentivized approach.

          2. jason wright

            what is the US government’s sanction against a US citizen who decides to go ahead and make an investment in such a fund?

          3. awaldstein

            Clueless.It is like asking what the punishment is before you commit the crime.I can invest other less articulate ways without creating tension for myself.

          4. jason wright

            then i don’t quite understand the premise of your original question to William. there is nothing that technically prevents you as a US citizen from investing in such a fund. the issue is the possible legal consequences. if you see none or simply do not care then you go ahead and invest.

          5. awaldstein

            If a fund by definition disallows by its charter certain people from using it you do not think they require proof of identity and residence?I am not in the habit of falsifying information around my financial transactions.Are you?

          6. jason wright

            which i find perplexing. is the reach of the SEC global? i would have thought that it is for the US citizen to become compliant with US law and not for entities operating outside of the US to police citizenship. this is heavy handed bureaucracy, which seems at odds with the core principles of ‘America’, and is an overreach of a nation state’s power beyond its sovereign borders.i am not.I hope i’m not giving you a headache. Try aspirin 😉

          7. Pointsandfigures

            The IRS might have a say.

          8. jason wright

            i feel a bit sorry for US citizens with their global tax obligations. citizenship and residency should not be bound together. it encourages insularity.

          9. jason wright

            Clued up or clueless, I’m thinking more about the future and the way things can and should be rather the way things have been and remain, meaning greatly unequal and unfair.

          10. JLM

            .The issuer is issuing a security. Securities — public securities — have to be submitted for approval to the SEC or individual states or “blue skyed” to be available to US investors.Selling unregistered and unapproved securities in the US is a serious transgression of the rules of good order.The onus is on the issuer to qualify their securities and if they sell an unregistered/unqualified security to a US citizen, they are in trouble with the SEC.The onus is on the issuer to ensure they know the exact identity of their investors. They cannot turn what is called “a willful blind eye” to these matters.A US citizen can create a foreign ownership vehicle (Panamian trust, a Channel Islands company, a Swiss numbered account) and use that vehicle to make investments in securities which are not otherwise available to US citizens.You have to pay your US taxes when the proceeds are distributed back to the US owner.This is not legal advice. And, I, personally, have never done such a thing. I read it in a Grisham novel. Haha. Sorry.JLMwww.themusingsofthebigredca…

          11. LE

            I am wondering @jlm if (in theory) William mentioning the securities violates the securities act.

          12. JLM

            .No, because he is a close friend of mine and I cleared it with Donald J Trump.JLMwww.themusingsofthebigredca…

          13. mplsvbhvr

            Little late to the party but keep an eye out for the ICNX token… it’s already a fund but last I heard the team was trying to create a tradable token as well.Unfortunately couldn’t find any recent news on it though…

          14. DJL

            I am catching up on AVC from short vacation. Investors are always looking for “Defensible IP”. Can a blockchain algorithm be patented? What is the landscape in the USPTO on this area?

      4. Girish Mehta

        Can it be called a index fund if it has a 5% management fee 🙂 ?#Joke.

        1. William Mougayar

          There’s a premium for value in everything.

      5. Chimpwithcans

        Hi William, Is this available for investments from someone like myself in South Africa?

        1. William Mougayar

          It should be. Best is to read the terms directly on the Iconomi site.

    1. fredwilson

      Well there was but then these funds got big and had to become 3c7 funds and that is no longer possible

      1. Joe Lazarus

        I see. So, is the best option to just read whitepapers and make your own investment decisions?

  2. jason wright

    What’s your position on SegWit2x?What’s Olaf’s position on SW2x?

    1. fredwilson

      Let the market decide

      1. jason wright

        very political answer. you invest in companies that take a position. they don’t let the market decide. they try to force a vested interest outcome.

        1. fredwilson

          It wasn’t meant as political. I’ve been in the middle of this battle for five years. I’ve learned a lot and my view is that it will be what it will be

          1. Pointsandfigures

            letting markets decide is the right answer. it will take more time and be messy, but the outcome will be better than a forced outcome.

          2. awaldstein

            you are suggesting that someone can force the outcome?in this instance how so?

          3. Pointsandfigures

            if there is a centralized bureau in place that simply makes the call versus letting the market play out, they force an outcome. Think Betamax vs VHS. The market decided, not the FCC.

          4. awaldstein

            In essence I agree 100% of course.This is not Betamax this is a crypto developer platform.Again–how can any outside force choose or heavily influence this decision except potentially by funding different solutions? And in this world, where funding is available from the market itself, that really doesn’t apply.

          5. Vendita Auto

            “funding different solutions” $ plc “funding is available from the market” $ plc

  3. Tom Labus

    His comment about explaining the Fed!! The original political push for a fed like entity came out of the Agrarian Movement. Huge swings in the economy left people like 08 on most cycles at that point. Reading this now on Fed independence.

  4. Pointsandfigures

    we are setting up something similar, but not in crypto assets with our fund.

  5. Mike Cautillo

    Does Polychain disclose its investments??

  6. JaredMermey

    Blockchain needs more people like Olaf. He is fully aware how “out there” many believe what he is doing is, but he calmly articulates his position without any condescension.

  7. Salt Shaker

    “I’ve always been a little bit skeptical of the blind trust people have in the financial systems that exist in the U.S.”Okay, a statement w/ some degree of merit, but I thought the video would then segue into Olaf’s capabilities and qualifications, rather a continuation of Kardashian puff. So I dug further and read the Forbes piece: “He (Olaf) can barely write computer code, has no formal training in financial analysis and has never managed money before.”So, what exactly are his credentials, other than winning Lotto? “Blind trust” indeed seems like the right descriptor, but perhaps in this case it’s misplaced. #flummoxed.

    1. JLM

      .Well, there is, as an example, $250,000 FDIC insurance per account for banks.That is hardly “blind trust.” There are other forms of insurance for different types of accounts. This is, typically, on a “per account” basis.This is not chopped liver.JLMwww.themusingsofthebigredca…

      1. Salt Shaker

        The FDIC doesn’t cover for a rigged system or market manipulation. It’s hardly a level playing field.

    2. Evan Van Ness

      Who is qualified in your mind to put value at risk in this ecosystem, if not Olaf?The most important credential in this space is understanding the technology and having thoughts about what can be built in such a nascent space. As someone who might raise a cryptofund (and theoretically be a competitor to Polychain), I can honestly say that I’ve never heard anyone say Olaf doesn’t understand the tech and have a vision of where it can go.Beyond that, I could appeal to authority: not only have some of the biggest name VC firms in the world backed his idea with capital, but many of the best founders want to work with Polychain.

  8. JLM

    .It is very difficult to understand the purpose of this lumberjack/crypto currency video.First, I must say that there is no more manly undertaking than a bit of lumberjacking and one has to take such a person serious. Those big chainsaws are not for the faint of heart.But, I really cannot understand the theme, message, or intent of the video other than being an interesting vignette.What am I missing?Again, one has to dig a lumberjack.JLMwww.themusingsofthebigredca…