Interview & Article: Anderson Sima, Executive Editor of Foresight News
Interviewee: Jason Huang (@Jhy256), Founder of NextGen Digital Venture
British science fiction writer Douglas Adams made this comment on technological progress: 'Any technology that is invented between the ages of 15 and 35 is a revolutionary product that will change the world. Any technology that is invented after the age of 35 is a violation of natural laws and will be punished by heaven.' Jason is now 36 years old, and he believes he has found that revolutionary product.
During the Christmas holiday of 2023, Jason spent time with his family in Osaka. On the way back, he made a prediction about the crypto market at the airport (at that time, Bitcoin was priced at around $43,000), stating that Bitcoin's price is expected to break $50,000 by May 2024 and reach $100,000 by the end of the year.
Reality is often more exciting than predictions. By December 2024, Bitcoin has already surpassed $99,000, and Jason's prophecy is only half a step away from realization. According to his estimates, the LPs of the first fund of NextGen Digital Venture he founded will achieve returns exceeding 300%.
The NDV first fund focuses on cryptocurrency stocks and was established in collaboration with the cryptocurrency wealth management company Metalpha (NASDAQ stock code: MATH). At the time of establishment, the U.S. spot ETF had not yet been approved, and traditional financial money had not yet paid attention to digital assets. NDV captured the increase in digital assets during the entire ETF approval process.
Jason Huang has extensive experience in the venture capital field, having worked at Huaxing Capital, Qiming Venture Partners, and other institutions. In 2022, at the age of 34, he chose to leave the family office Blue Pool Capital established by Jack Ma and Cai Chongxin. Under the puzzled gaze of some, he plunged into the cryptocurrency field and founded NextGen Digital Venture. In the same year, the Golden State Warriors, led by Stephen Curry, who is the same age as him, won the NBA championship for the season. This is his favorite team and player. 'Curry's championship in 2022 gave me immense courage to start my business,' Jason Huang said.
After founding NDV in 2023, I had previously interviewed Jason about the dynamics of the cryptocurrency market at that time, and some of the content resonates with today. A year later, I once again invited NDV founder Jason Huang to discuss the changes in the cryptocurrency industry over the past year and future investment trends. Here is the edited interview content.
A return rate of over 300% in 20 months
Foresight News: Last year during the interview, the NDV first fund had just launched. At that time, the Bitcoin spot ETF had not yet gone live, but you were very firm in holding Grayscale's trust products. Can you briefly introduce the situation of NDV over the past year?
Jason: One of the most important things in the first year was to allocate most of the fund's positions in GBTC. At that time, it had a discount to Bitcoin, which gradually recovered, and after the ETF was approved, the discount was fully restored. By the end of last year, we realized that after the approval of the ETF, it would become a pure Bitcoin index, so we switched strategies to focus on stocks related to cryptocurrencies, such as Coinbase and MicroStrategy this year.
Overall, we have believed from the start that the best investment method is in securities or stocks related to cryptocurrencies, because it's difficult for traditional finance to directly buy coins as the first step into digital assets. Stocks are a way that institutional investors are more familiar with. Our positioning is to help traditional finance invest in cryptocurrency-related fields and obtain returns. We entered the market on March 29 last year at $29,000, and the overall fund has gained more than 300%, outperforming Bitcoin by a lot.
Foresight News: Looking back at the decision-making process, coming from the traditional VC investment field, there must have been many differing opinions?
Jason: Indeed, many people do not understand, and even now, I have friends asking the reasons behind my decision back then. But I believe finance is merely an innovation on the two ends of funds and assets, and you must grasp one end. A few years ago, Sequoia China and Hillhouse also rose with the waves of China's internet and healthcare industries. If cryptocurrency develops, we have the same level of opportunity; it just needs time. Our fund is not even two years old; everything is just beginning.
Foresight News: What is NDV's positioning in the market?
Jason: I just mentioned that finance essentially involves innovation at both the funding and asset ends. NDV's positioning is essentially about doing two things:
1) Bring traditional financial money into Crypto
2) Bring excellent assets into Crypto
We have accomplished the first task through stock funds. Next, as the regulatory environment in the United States changes, we can also focus on the second task. Changes in the management of the U.S. SEC may bring a whole new opportunity to Crypto. When tokens can pay dividends and can be issued with lower compliance costs, it may bring new changes to the world of coins. I am seriously researching which assets may bring new changes. This will be a significant theme in the coming years.
The future of Bitcoin: A national reserve asset?
Foresight News: What changes might the cryptocurrency market face after Trump takes office?
Jason: I believe the most important factor is the potential change in the SEC chairman. The probability of Gary resigning is very high (note: shortly after the interview ended, Gary announced his resignation). This could lead to changes in Bitcoin market regulation policies. As for market feedback, if the Democratic Party had won, the rise might have been more moderate, but now with the Trump administration's friendlier policies, the market is rapidly jumping the gun, making it harder to predict.
In this election, the Republican Party gained majority support in both houses of Congress and the Supreme Court. In American history, only two presidents have received such treatment - Lincoln and Little Roosevelt. Now the third is Trump, and many people around Trump hold a large amount of Bitcoin, including Vice President JD Vance and Musk, as well as Peter Thiel behind Vance.
If the U.S. Congress begins to discuss using the federal reserve budget to purchase Bitcoin, even if it is just a discussion, the price of Bitcoin may rise significantly. At that time, the price of one Bitcoin reaching $200,000 to $300,000 is possible, but it is uncertain whether this will be a priority option for the Trump administration.
Foresight News: Currently, Bitcoin is trending from digital gold towards being a national strategic reserve asset. What are your thoughts on this?
Jason: I cannot specifically discuss certain institutions, but there are indeed some sovereign funds in discussion. After speaking with some mid-sized sovereign funds, they are currently not at the level of considering Bitcoin as a strategic reserve. I even think that the actions of the U.S. might be faster. Some sovereign funds are cautious due to previous investment failures in exchanges or related companies, and for now, they are waiting to see what the U.S. does.
However, once the market changes, this trend may happen faster than we imagine. I originally thought this could be a six-year story, but it might be completed in just two years.
Foresight News: Will the funds from these traditional fields directly invest in Bitcoin itself?
Jason: It is rare to directly invest in Bitcoin itself. Many members of the investment committees of university endowments and pension funds I interact with are mostly in their 60s and 70s. For them, Bitcoin is a difficult new thing to understand, but if you lobby it as a new technology field, the acceptance will be much better. At that time, they might be willing to invest in related companies rather than Bitcoin itself. However, the approval of ETFs will allow institutional investors to allocate more compliance to BTC, which is also why this round of the bull market is a 'Bitcoin bull'.
Is Ethereum Alibaba and Solana Pinduoduo?
Foresight News: It seems your strategy does not involve much in Ethereum ETFs. The previous cycle saw Ethereum's growth far surpass that of Bitcoin, but now there is a lot of dissatisfaction with Ethereum. What considerations are behind your lack of engagement with Ethereum?
Jason: When introducing the cryptocurrency world to traditional funds, I found that they already struggle to understand Bitcoin, and understanding Ethereum is even harder. Moreover, my investment logic tends to favor investing in things that change, such as the X factors that can change market rankings, like Pinduoduo, which emerged later and disrupted the e-commerce landscape. I believe that Ethereum currently lacks substantial innovation or large-scale applications, which can be felt from market enthusiasm and capital flows. Conversely, Solana has some of the characteristics of Pinduoduo. Although I do not hold Solana, I appreciate such stories of change.
Foresight News: What is your current personal asset allocation structure?
Jason: When I founded NDV, I almost invested all liquid assets into cryptocurrencies, except for my house or primary market assets. Putting most of my personal liquidity into my own fund, I think this is the best explanation to LPs. Currently, the ratio of Bitcoin and other cryptocurrencies in my assets is about 5:1 to 4:1.
Non-Bitcoin investments are all projects done by founders I know well and who are very capable, or recommended by friends. For example, I wrote on X in early October that I bought a meme recommended by my partner Christian, which has increased about 20 times from the bottom to now. The core here is the transfer of trust; I believe in what reliable people are doing or the endorsements from people I trust greatly. However, I treat these as venture capital investments, which are positions I am willing to risk losing.
Foresight News: What are your plans for the next year?
Jason: I made a commitment to the investors of the first fund that I would liquidate the fund at the peak of the cryptocurrency four-year cycle. I personally believe the peak should occur within the next 12 months, depending on the macro environment and policy changes. After that, I will seriously explore the previously mentioned topic of bringing Web2 to Web3.
