Sticking to Conviction – Long Positions, Overweights Deliver This Week

Performance Recap (Fri 25 Apr → Friday 02 May)

What We Got Right ✅

➕ Maintaining long-only positions
Despite our expectation of a dip, we maintained a combination of long positions and cash, allowing us to catch a strong part of the upside performance.

➕ Overweighting Smaller Caps
Overweighting Ethereum, which outperformed Bitcoin this week is a choice that paid off.

What We Got Wrong ❌

❌ Elevated Cash Holdings
Markets are up 4% this week and our elevated cash level led to a slight underperformance of the benchmark.

➡️ What surprised us: Bitcoin dominance slipping sooner than expected
Altcoin strength has come earlier than projected — ETH, SUI, and others are catching flows. We anticipated rotation later in May.

Key Lessons

? Dominance Trends Matter
BTC dominance declined over the weekend, and altcoins outperformed on relative basis. This kind of subtle signal could be the early stages of an alt season.

? Institutional Buying > ETF Inflows Alone
While ETF flows slowed, corporate buyers (e.g., Strategy, MetaPlanet, TwentyOne) helped underpin BTC. These non-retail actors remain the key foundation for resilience.

⏳ Timing Pullbacks Is Harder Than Riding Breakouts
We’re well positioned to catch dips, but the market hasn't cooperated yet. In the next rotation, we may stagger re-entries rather than hold such a large cash position.

What next?

Our conservative posture helped us reducing the volatility but recent developments show digital assets momentum could extend further, allowing us to increase our exposure again. However, we missed a modest ETH rebound and early altcoin rotation. ETF flows are slowing, momentum is fading, and macro risk looms — but the market has yet to correct.

We’re watching for confirmation of a breakout or a true reversal. For now, staying defensive gives us flexibility — but we’re ready to re-engage if altcoin strength persists and macro data doesn’t derail the trend.

Understanding Our Benchmark and Positioning Terms

Our benchmark is a market-cap weighted index composed of Bitcoin (BTC), Ethereum (ETH), and Solana (SOL) — the three most widely held and institutionally tracked assets in the space. Weightings are determined based on each asset’s relative market capitalization at the start of the review period.

When we refer to “neutral weight,” we mean a position aligned with the benchmark weight. An “overweight” position indicates we hold a larger allocation to that asset than its benchmark weight, reflecting higher conviction or expected outperformance. Conversely, an “underweight” position means our allocation is below the benchmark weight, typically due to near-term risks or weaker conviction.