Question: Bill, can you talk about your recent investment situation?

Bill: Hello. Our fund is quite fortunate; in this cycle, we heavily invested in Solana, Ton, and Sui during the bear market, and we also invested in star projects like Peaq, Uxlink, and Bouncebit at the application layer. So overall, we currently have more than 6x returns, and the overall liquidity is very good.

Question: We've heard that many VCs have had a tough time in this cycle. What do you think?

Bill: In the previous cycle, everyone was rushing to exit after going public (VCs ran too). In this cycle, it's a 'let the bosses run first' cycle. Who are the 'bosses'? The exchanges and the founding teams. And VCs are required by exchanges and founding teams to practice the 'long-termism' value, so they began to be bound by an average lock-up period of 3 or 4 years, only able to watch the K-line chart, seeing exchanges and founding teams cashing out, helpless and anxious. I often joke that being a VC in this cycle is not a profitable business, but rather becoming a 'junior' financial consumer, making donations (grants) to promote the industry's development, which can also be considered a meritorious deed.

Question: But doesn't the founding team also have lock-ups? Aren't they also very 'long-termist'?

Bill: You're referring to the 'Team Allocation' lock-up in the funding PPT, right? This is just a formal 'Team Allocation.' You can understand it as the entire coin supply being owned by the founding team, so all the continuously unlocked coins in the whole supply are a pool that the founding team can sell for various reasons. It's just that for some coins, the team sells to continue developing the business; for others, the team sells to buy Ferraris.

Question: Few funds like yours have managed to simultaneously capture Solana/Ton and Sui in this cycle. Can you talk about the stories behind these investments?

Bill: In this cycle, I became the largest investor in Solana in the Middle East, possibly ranking among the top three globally. When you feel an opportunity is right, the remaining decision factors are courage and position. I have experienced being an investor through the entire Web1, Web2 to Web3, and the training I received made me deeply understand the concept of 'concentrate to get rich.' Whether it's Tencent or JD for Hillhouse Capital, ByteDance for SIG, Tesla for Baillie Gifford in Scotland, or Apple for Buffett in his later years, holding core assets has always been a source of important returns.

Question: You've supported Ton for a long time, can you talk about it?

Bill: We are the first institutional investors in Ton globally, and I personally am the first global external director of the Ton Foundation. Our cost is less than a quarter of what many Silicon Valley funds invested later. The logic behind my joining the Ton Foundation as a director and advisor was: among the top five social communication software in the world, one is in China, three are in the US, and they can't do Web3, and the other is Telegram, so I invested. Moreover, to be frank, at that time Western investors had doubts about Ton, thinking it was a Russian project and they were wary of the previous incident with Telegram’s gram. But since I live in Dubai and frequently meet their team, I understood their enthusiasm and vision, which made me more resolute. Furthermore, if we take a step back, isn't crypto anti-establishment? Those making big money in this industry are all anti-establishment, such as USDT and Binance.

Question: I remember the primary market financing for Sui was very competitive, basically dominated by a16z, Sequoia US, etc. At that time, Cypher was just a very young investment institution. How did you get the allocation?

Bill: We are the first team in the world to help sovereign countries establish Bitcoin strategic reserves, the only crypto listed company in the Middle East, and the only state-owned enterprise in the crypto industry globally (our group Phoenix's major shareholder is an entity of the UAE government). When communicating with founders, instead of positioning ourselves as 'a young investment institution,' we prefer to introduce ourselves as 'industry investors from the Middle East.' Therefore, founders are very willing to cooperate with us and specifically allocated $5 million to us. This also made us the only investor in Sui in the Middle East, and we should have the highest share among global Chinese investors.

Question: Why did you heavily invest in Solana and become their largest investor in the Middle East?

Bill: Because we saw that after FTX, developers are still in the Solana ecosystem. Meanwhile, MEME has surged, so when the market is still uncertain about Solana, we decisively increased our position and became the largest investor in Solana in the Middle East in 2023. At the same time, we also brought Solana to the Middle East, and next year Solana will hold its breakpoint annual meeting in Abu Dhabi.

Question: In this cycle, many people are pessimistic about VC, feeling that VCs are neither likable nor making money. What do you think?

Bill: 'Success and failure are intertwined, temporary glory and decay.' I am not pessimistic about the VC industry, although we must admit that this cycle's VC is experiencing a challenge. For the next cycle, it is very likely that because of the clearing of VCs in this cycle and the emergence of many new innovations under the environment of technological advancement and regulatory easing, the days for VCs will improve. It's like the Silicon Valley VCs established in 1999 had a very poor year, and most investments ended in bankruptcy, but VCs established in the years after the tech bubble burst in Silicon Valley saw a reversal in return performance. I am optimistic about the VC industry overall because the development of the industry needs us, including: screening good teams and development directions for the industry, providing vision and resources for founders, improving project success rates, and ultimately providing quality assets for the secondary market.

Question: VCs in the Web2 space are still operating various multi-billion dollar AI projects. Do you think there is a difference between VCs in the Web2 and Web3 industries?

Bill: It's still very different. The Web2 industry requires 'high walls, ample grain, and delayed kingship,' so the typical strategy is: raise enough money in the primary market, such as $1 billion, $10 billion, or even more, which is 'ample grain'; continuously expand market share, delay profitability, and build one's own moat, which is 'high walls'; delay going public, so there's no need to pay attention to quarterly reports and public investors, and delay dividends, which are all 'delayed kingship.' The core support behind this strategy is private market capital, that is, VC. So we can see that Web2 VCs are getting larger and larger, to the point where one fund can raise $100 billion, because they need to provide enough ammunition for the 'nuclear war' between founders.

However, the logic of Web3 is different; it emphasizes 'fame should come early.' The current cycle from primary to secondary market is a bit too short, which doesn't support good teams to steadily develop products. This rapid wealth accumulation model will push founders to chase trends, do marketing, and quickly get listed. Therefore, I think Web3 needs more 'patient capital' and should lean towards the style of the Web2 industry, able to accompany founders in accumulating more in the primary market.

Question: Thank you, the last question, what do you think about the peak of this bull market? Will there be a peak? Or will there be a super cycle?

Bill: Be cautious when people start talking about a super cycle. It's like someone starts telling you: this time it's different, this time the tree will definitely grow to the sky. The big logic of the crypto industry is still growth, but the specific form is certainly a spiral rise within cycles. Market timing is very difficult; we usually build our portfolio based on the current market sentiment, making it more aggressive or defensive. Thank you!