A Cincinnati cryptocurrency investment fund has soared in value, proving Bitcoin isn’t the only currency of its kind to skyrocket lately.
Downtown-based Cincinnati Crypto Fund turned in a whopping 90% gain in value for investors last year, Bob Buechner, co-founder and a managing member of the fund, told me. The S&P 500, by comparison, had a strong year by generating an 18% total return.
“It has been amazing,” Buechner said of the fund’s results.
He acknowledged cryptocurrency results have ridden a roller-coaster and so has Cincinnati Crypto Fund. But he said the fund invests in a variety of cryptocurrencies and has more steady results than the wildly volatile Bitcoin that’s the most familiar part of the sector to investors.
“Our results are less severe on the upside and on the downside,” Buechner said.
Bitcoin more than quadrupled last year. Not to be outdone, it has already soared 74% so far this year.
But those gains didn’t come without some wild swings. Bitcoin plummeted 37% in a day last March as the coronavirus pandemic took hold. It also plunged 14% in two days at the beginning of September. It’s not for the faint-hearted.
But Buechner sees Cincinnati Crypto Fund as a way for investors to get into investing in cryptocurrency without those stomach-churning moves.
“Our goal is to expose people to the world of investing in cryptocurrency.”
Buechner, who is shareholder, chairman emeritus and co-founder of downtown law firm Buechner Haffer Meyers & Koenig, teamed with Michael Hiles and Stacey Strasser to launch the fund in 2018. Hiles is an entrepreneur and blockchain/cryptocurrency expert who is founder and CEO of Cincinnati-based financial technology company 10XTS Inc. Strasser is business solutions manager with Ascendum, a digital, staffing and technology consulting firm based in Blue Ash.
“I met them at a crypto-conference in Northern Kentucky,” Buechner said. “We started talking and I said, ‘Why don’t we start a fund to give people a chance to invest in crypto?’”
But they didn’t make their first investment until the end of 2018. They really just made one investment, in Orlando, Fla.-based cryptocurrency investment fund Libertas Fund. That fund looks for large investments of $1 million or more. Buechner calls Cincinnati Crypto Fund “a hedge fund feeder fund” because it invests all of its money in another hedge fund.
Like cryptocurrency in general, the fund has had its ups and downs. In the first six months of 2019 it soared 80%. It came back down but skyrocketed again last year. And it surged 20% in the first half of February this year. The gains have made for some happy clients.
“Every outside investor is positive,” Buechner said.
The fund has $1.5 million in assets from about a dozen investors, Buechner said. The minimum investment is $25,000.
Crypto investing comes with some pitfalls. Buechner says the biggest risk to what he calls “the crypto phenomena” is that it’s not tax compliant. Many investors don’t realize their gains are taxable. So he’s been working with clients to help them wade their way through the taxability of their returns.
But it’s a good problem to have.
“For some investors it’s obviously a huge moneymaker,” Buechner said.
