Astronaut Capital Quarterly Report Q1 2024
From the CEO
It looks like we are in the early(ish) innings of a bull market with secondary markets putting on a huge amount of weight this quarter. Everything from Bitcoin to dog coins have found themselves a surge of liquidity and interest.
Institutional interest has certainly kicked things off, but we are now seeing some retail numbers trickle through.
Broadly markets have risen substantially but we have seen more tremendous gains from that of the memecoin market and select L1's.
Our portfolio has done well this quarter with its diversified exposure in ETH and several defi protocols, however, we slightly underperformed BTC as we are yet to see a large rotation to alts.
Our focus remains on risk management and planning for partial exits given the momentum of the market. Rotation to new coins will be limited fort the foreseeable future.
A distribution will be sent to token holders for this quarter. You will find the details in the following pages.
Have a great quarter ahead,
Until next time,
Matthew Dibb
CEO of Astronaut Capital
Macro Outlook
The dawn of a full-blown crypto bull run
If Q4 was any indication of markets heating up, it was just a spark in comparison to Q1. Momentum was fueled by Bitcoin’s ETF approval on 10 Jan, where the BTC brushed off “sell the news” dip and rallied 90%, surpassing its all time high to just shy of $74k.
This was the moment that most crypto investors have been waiting for as it signifies the onset of the next bull market. Total Crypto market rallied more than 65% before retracing in March. BTC and ETH touched highs of $73,900 and $4,090, registering gains of 66% and 56% respectively.
This period has also been coined the ‘memecoin mania’ with SHIB, PEPE, BONK, TRUMP, WIF all driving liquidity towards their social and cultural experiments. The craziest of it all — BOME reaching $1b market cap in just a couple of days.
These events have boosted onchain activity, especially on Solana where volumes surpassed that of Ethereum. Furthermore, spotlight from international media outlets, including Bloomberg, has reignited interest in cryptocurrencies and the broader market — An overall win for crypto we believe.
News and Developments
It has been a busy quarter with news circulating at an unprecedented pace. It is not surprising that much of the buzz has centered around Bitcoin’s ETF launch, soaring memecoin prices and how the crypto bull market has returned.
Yet, while we observe these headlines with optimism, there has been many developments in the space too. This includes numerous airdrop farming tokens that launched their platforms, introducing exciting dApps and ecosystems — such as Wormhole ($W), Blast L2, Starknet ($STRK), Jupiter ($JUP). Ethereum also successfully implemented Dencun upgrade which lower fees on L2. The number of positive news significantly outnumbered negative ones, adding fuel to the ‘FOMO’ and ‘Hype’ of the market.
Positive News
- US SEC approves bitcoin ETFs — A watershed moment for crypto
- The combined net inflow of Bitcoin ETF’s exceeds $1b
- Ethereum successfully implemented Dencun Network upgrade
- Revolut launches learn and earn campaign with memecoin $BONK
- Restaking heats up at TVL surpass $10b on EigenLayer
- 3 Crypto companies make Forbes Fintech List — Chainanlysis, Fireblocks, Gauntlet
Negative News
- Hong Kong crypto exchange BitForex closed shop suddenly, leaving customers stranded
- Vaneck agreed to pay a $1.75M fine to SEC failing to disclose influencer’s role in ETF’s launch
- Security breach caused Ripple founder to be hacked for $113m
Astronaut Holdings
Changes to Portfolio Holdings in this Quarter
Total Portfolio (Liquid Assets)
Illiquid Assets
Assets that have been entered into at early-stages are still to be considered illiquid or not viable to factor into performance measures.
Dividends
Distributions to token holders
Astronaut Capital declares a dividend payment of $0.025 per ASTRO token, which represents 50% profits distributed to ASTRO holders, translating into a dividend yield of ~37% (APY) versus the current ASTRO price.
The dividend is payable proportionally to all eligible token holders based on the number of tokens (ASTRO) held as of the snapshot date, 3 Apr 2024, 16:00 hrs (GMT +8). A breakdown of dividend calculation can be found below.
*For more clarity and dividend criteria, please refer to our Dividend Distribution Policy
Net Fund Figures
Dividend Distribution Figures
High Water Mark
Performance Fees (10%)
Astronaut Capital will not take any performance fees this quarter, as the FUM value did not exceed the prior high-water mark.
Astronaut Performance
Post Mortem
Q1 2024 In Review
Retaining our previous thesis that 2024 will be the start of a bullrun, the market in fact overdelivered on this note. Our expectations of Bitcoin’s dominance overflowing into Alts begin to come to fruition with Ethereum delivering 56% gains from previous quarter.
Our other 2 significant holdings in LINK and SNX were also up 30% and 25% respectively, albeit not as strong as the majors. It appears that more patience is required as we underestimated the time needed for liquidity to be rotated into Alts other than BTC, ETH or non-meme related coins. This also offers prospective rotation opportunities throughout the rest of 2024.
Additionally, notable gains also came from the GameFi sector, such as IMX (34%) and ILV (45%). These successes are in part of a narrative overflow from the memecoin season. We also witnessed a rally in LSDfi restaking given the hype over Eigenlayer and Blast. Our outperformer came from our position in PENDLE, which netted 236%, 3x from the previous quarter.
The team has also trimmed non-performing assets (TRU and RLB) and added Filecoin (FIL) to expand our exposure to DePin (Decentralized Physical Infrastructure). In addition, we have introduced a speculative component with a small allocation to Dogecoin (DOGE), enabling us to tap into the memecoin sector.
Overall, Astro delivered a performance of 32.7% over the quarter. We discuss some of the metrics relating to the fund’s performance below.
Comparative Benchmarking
Fund Performance Since Inception
The fund has paid a cumulative dividend amount of $6.95m since inception. The audit indicates that Astronaut Capital’s overall fund performance with paid dividends is $8.02m, which is 264% higher as compared to the value when the fund was launched in October 2017.
Liquidation of Holdings
ASTRO trimmed our assets TRU and RLB and re-positioned into sectors we believe could outperform, namely DePin and a small portion into memecoins.
We have minimized liquidations, concentrating instead on asset rotation and maintaining full market allocation. We believe that we are in the early stages of the bull cycle, having numerous bullish indicators ahead, with anticipation for the peak of retail euphoria to come.
Outlook for Q2 2024
2022 — The year of the correction
2023 — The year of a recovery
2024 — The year of the bull market rally
Reflecting the 3 points above from our last report, we have experienced a great start to what appears to be a vigorous bull market cycle. Once again, crypto has shown how intense an uplift of markets could be, reminding ourselves the volatility back in 2020. BTC domination has been a key flavor in Q1, however, we expect some of the hype to taper off during Q2 as we approach halving.
We expect focus to shift towards ETH and SOL fueled by the anticipation of their respective ETFs. Such developments could prompt investors to rotate their profits from large caps into mid and smaller caps, re-igniting a potential Alt season.
As such, we anticipate a more risk on approach in Q2, forecasting that DeFi, LSDfi, restaking tokens could regain market flavor. The DePin sector is another area we believe could outperform. We remain optimistic about our investments in LINK and FIL and plan to seek out and invest in tokens with similar attributes.
Moreover, Astro will be keeping tabs on value tokens in this sector that were launched in the previous cycle, of which have mostly been unlocked and are down significantly from their highs, providing a favorable risk-reward for the upside.
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Astronaut and its affiliates do not provide tax, legal or accounting advice. This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your own tax, legal and accounting advisors before engaging in any transaction. We disclaim all liability and responsibility arising from any non-compliance placed on such materials by you or any other visitor to Astronaut or by anyone who may be informed of any of its contents. This is not investment advice.
