The 35-year-old fund manager recently shared with Bloomberg about his crypto journey since joining the ecosystem and co-founding Three Arrows Capital with Kyle Davies. Since its inception in 2012, the Singapore-based crypto fund has managed a diverse portfolio of cryptocurrencies such as Bitcoin, Ether, AVAX, and SOL, as well as other crypto-related investments totalling more than $10 billion in assets under management (AUM).
“I first started dabbling in Bitcoin in early 2013,” Zhu told Bloomberg markets’ Joanna Ossinger. “In late 2017 it became extremely clear to me…that crypto was going to follow the dot-com cycle of creative destruction and then eventually become a paradigm shift across finance, technology, culture, and politics.”
Zhu went on to describe projects he was particularly impressed with.
Apart from purchasing a significant stake in Deribit, a leading crypto exchange in the early days of crypto, Zhu stated that he had also keyed into various Layer-1s such as Polkadot, Solana, and Avalanche via the over-the-counter market, despite feeling contrarian at the time.
His proudest moment was correctly forecasting the bottom of the December 2018 Bitcoin dip, with a tweet on Dec. 21, 2018 stating, “We will pump off the bottom extremely quickly, leaving most sideline investors stuck in fiat.” Since the announcement, Bitcoin has increased by 2,156%, or 20x ROI, reaching $68,754 on November 10, 2021.
“I don’t think there’s anything I’m not proud of. Even the ones that lose money, it’s important that those projects were attempted, and founders tried things.” Zhu elaborated.
Zhu, who believes in Amara’s law, which states that “we tend to overestimate the effect of a technology in the short run and underestimate the effect in the long run,” sees a lot of potential in layer-1 networks (Avalanche, Solana, Polkadot) and Web3. His firm is already involved in projects such as Axie Infinity, as well as a variety of other crypto projects that he believes are under-subscribed.
“The areas of most potential are likely not even thought of as crypto use cases today.” Zhu continued, “I’m excited about what scalable L1s [Layer 1 blockchains, which run independently of other blockchains] like Avalanche can enable for users and application developers.”
He believes Bitcoin will become a key reserve currency as nations continue to rally their support around it, spurring further growth for other crypto projects.