Turning Crypto Chaos Into Clarity
September 18, 2025
A Disciplined Path Into Digital Assets
Digital assets are here to stay—but navigating them requires more than simply applying traditional hedge fund playbooks. Martin Green, CEO at Cambrian Asset Management, explores which hedge fund strategies translate effectively to crypto and which do not – important factors RIAs need to know before allocating.
While digital assets offer tremendous potential—accessing them without the volatility and drawdowns of long-only crypto remains a challenge. Opportunistic investors look for quantitative long/short strategies that harness inefficiencies to deliver alpha, diversification, and institutional-quality exposure.
That said, accessing digital assets requires careful consideration of both risks and opportunities. Here’s what RIAs should know when evaluating different approaches:
- Passive ≠ safe: Crypto indexes like the Bitwise 10 have delivered strong historical returns, but extreme drawdowns often erode risk-adjusted performance compared to benchmarks like the Nasdaq-100.
- Active strategy challenges:
- Trend-following: Volatility without direction often leads to false signals and execution risk.
- Long-only: “Liquid venture” strategies can soar in bull markets but risk 90%+ drawdowns.
- Market-neutral: Asset concentration and counterparty risk limit diversification and arbitrage opportunities.
- The middle ground: Tailored, risk-conscious approaches that explicitly manage volatility, anticipate execution costs, and capitalize on inefficiencies unique to crypto markets.
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Here are a few questions to consider as you navigate digital asset allocations:
- How are you managing volatility and downside risk while seeking exposure to digital assets?
- How can you balance capturing upside with minimizing volatility and drawdowns?
- How are you addressing counterparty, concentration, and execution risks unique to crypto markets?
*Cambrian is the author and sole source of the commentary above
Disclosure: Digital assets can involve a high degree of risk, including the potential for volatility and loss of principal, and may not be suitable for most investors.
About Cambrian Assets Management
Cambrian Assets Management is a quantitative investment firm focused on digital assets. Trading since 2018, Cambrian is focused on diversifying risk-managed alternatives to passively investing in digital assets. They are the largest investor in their strategies, which are not suitable for most investors. They partner with a select number of sophisticated investors including global family offices, wealth managers, and institutional allocators.
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