The Ivy League, Yale University is fundraising to invest big in cryptocurrency. The distinguished educational institution helped raise $400 million for the ‘Paradigm’ fund. The fund was founded by Coinbase Inc, co-founder Fred Ehrsam, former Sequoia Capital partner Matt Huang, and Charles Noyes, ex-team member of crypto fund Pantera Capital. Paradigm isn’t the only crypto fund Swensen has singled out this past year, crypto funds run by Andreessen Horowitz have seen money from Yale this past June as well.
David Swensen, who has managed Yale University’s nearly $30 billion endowment fund for the past three decades, decision to institutionally invest into crypto signals good things to come, despite the bear market. Yale’s endowment totals $550 billion in assets and Yale’s investment funds are only second in the nation to Harvard’s.
Swensen’s strategies in the past have averaged 11.8 percent return on investment since the mid-80s. Now at a time when crypto markets have taken a beating since their late 2017 bull run, Swensen’s decigion to help raise a total of $400 million for Paradigm, sends a big message to the crypto community that has been waiting for a green light for the better part of 2018.
Paradigm is said to invest in early-stage cryptocurrency blockchain and exchange projects exclusively. The actual dollar amount Yale has thrown in the crypto-ring has not been disclosed at this time. The Bloomberg report came from an anonymous source and the university has not responded yet to any further inquiries.
Over the past 30 years, Yale has dramatically reduced the Endowment’s dependence on domestic marketable securities by reallocating assets to “nontraditional asset classes”, as noted in the chart below of the endowment’s asset allocation:
The “Warren Buffet of university investment”, Swensen, having so much recent interest in taking up long-term crypto positions might help to surge the market as we come into the second half of 2018. This could be good news for the community as crypto investors continue to wait for Wall Street and the SEC to reverse bear markets with improved regulations and ETFs.