Interview with NDV Founder: Tech Family Offices Become Main Force Entering Asia, Are We Already in the Late Bear Market Stage?

Interview: The Round Trip

Compiled & Translated by: Yuliya, PANews

Against the complex backdrop of spot bitcoin ETF approval, accelerating institutional capital inflows, and a persistently high global macro interest rate environment, the traditional investment paradigm of the crypto market is facing profound challenges. When the old “four-year cycle” roadmap may no longer apply, investors are in urgent need of a brand-new navigation chart to cut through the fog and seek certainty across bull and bear markets. Jason Huang, Founding Partner of NextGen Digital Ventures (NDV), brings with him investment discipline honed in the world of traditional finance, providing the market with a unique value investing perspective.

With over a decade of venture capital experience at top institutions such as China Renaissance, Qiming Venture Partners, and BlueRun Ventures, his crypto equity fund NDV outperformed bitcoin by 60%-70% in its first phase. In the new Founder’s Talk series of “The Round Trip” jointly produced by PANews and Web3.com Ventures, hosts John Scianna and Cassidy Huang invited Jason Huang to share why he decisively entered the crypto industry at the end of the last bull market, his unique insights into the current market cycle, and how to apply classic value investing principles to crypto asset valuation—such as investing in an exchange (one that is still undervalued compared to another exchange’s market cap)—to pursue excess returns from value reversion.

The Bear Market Is the Best Investment Opportunity; Asian Allocations Remain Conservative

Host: Welcome, Jason, to this episode. The timing of your entry into the crypto industry is quite interesting—it was right at the end of the last bull market, and you then experienced a full bear market. Now, the market seems to be entering another period of volatility and adjustment. Looking back, do you regret your decision?

Jason: Absolutely not. First of all, I have always believed that the bear market is the best time to invest. We were very fortunate that NDV’s first fund officially launched in March 2023, when bitcoin was around $30,000, if I recall correctly. Then, before the major market rebound in February this year, we completed the exit and liquidation of our first fund. I can say that our first fund performed very well, delivering nearly 4x returns to our initial investors, with investments mainly in crypto equity.

I feel that the current stage is very different from when I first entered. Back then, I had to spend a lot of time convincing clients that crypto assets were worth allocating to, even if it was just 1%. But now, especially after the approval of the spot bitcoin ETF, institutional investor interest has risen significantly. Now, our discussions with clients have shifted from “should we invest” to “what proportion should we allocate” to crypto assets.

Host: What allocation ratios have you observed? Has this changed in the past few months?

Jason: I live in Asia, and here, crypto asset allocation ratios are generally quite low—overall, it’s still a very early stage. Most people I interact with have less than 1% of their total assets in crypto. Now, I usually suggest they increase this to around 5%. I think this is a more conservative and balanced allocation for them.

Current Potential Selling Pressure Is Limited; Catch-Up Rally May Arrive Next Year

Host: Since the beginning of this year, we’ve seen bitcoin drop more than 30% from its highs. We’re curious—how do traditional Web2 investors now view crypto assets and the entire blockchain industry? Are they still interested, or do they see it as a high-risk asset that needs to be reduced?

Jason: I think it depends on the individual. For those who entered the market this year, most have experienced some drawdown and will likely choose to hold, but if you ask them to add more now—given the market volatility over the past three months—they may be more cautious.

But for those who have never allocated before, I think they’re actually eager to get started now. Many people are worried about the so-called “four-year cycle,” since it has indeed repeated in the past. But personally, I think we may no longer experience that traditional four-year cycle. The reason for the cycle was that bitcoin’s new supply (block reward halving) occurred every four years. But in the current cycle, about 19 million bitcoins have already been mined, and the new issuance over the next four years will be only about 620,000 coins. This potential selling pressure is actually negligible compared to the scale of ETF capital inflows we’ve seen in recent years.

So I believe that bitcoin is now more or less correlated with the US stock market. Given that we’re still in a high interest rate environment, once the Fed starts cutting rates next year, I believe a new bull market will begin. So I’m quite bullish right now.

Host: Your bullish logic is interesting. But if we look outside the crypto circle, since crypto assets are highly correlated with US stocks, why should I take on such high risk to invest in them? If I invest directly in the AI sector, the risk seems much lower.

Jason: If you look at the performance of different asset classes from a macro perspective, you’ll find that bitcoin may be the only major asset class with negative returns this year. I even joked that this year we’ve underperformed some emerging Asian market assets. This is very unusual for bitcoin, because looking back over the past 12 years, it’s been the best-performing asset class for nearly 9 of them.

So I think we’re actually in the “late bear market” stage, and compared to other assets, bitcoin’s performance is clearly undervalued. Therefore, a catch-up rally is likely next year. As for AI, to be honest, I don’t have a particularly firm view. Just this morning I watched an interview with Michael Burry, where he talked about Palantir. I checked its price-to-earnings ratio (PE)—800 times... I find it hard to see how that’s undervalued.

Tech Family Offices Are the Main Force in Asia; Bitcoin and Gold Are Beneficiaries of the Macro Environment

Host: But Nvidia’s PE isn’t that exaggerated. Speaking of investor types, I feel Asian investors are generally more traditional—they’re not even Web1 risk-takers, preferring tangible assets like real estate. Getting them to leap into AI or crypto seems like a big challenge. Or do you think they prefer a Buffett-style approach, favoring stable, profitable businesses?

Jason: I think there’s nothing wrong with that investment philosophy, and I wouldn’t lump all Asian investors together. The traditional real estate families you mentioned do prefer tangible, cash-generating assets, but they’re also facing significant pressure recently.

But I interact more with family offices from China’s tech industry. In their world, success comes from “network effects.” Globally, aside from bitcoin, there are almost no assets with the same level of network effect. Bitcoin is likely to become the most popular “application” over the next 10 to 20 years because it’s an asset that almost everyone will want to hold a certain proportion of. So, if we look at the buyer structure, the real main force entering the Asian market now is these tech family offices.

Host: For these tech family offices, do you think their demand for bitcoin allocation is still growing? Especially at this point in time, is there a strong desire to increase holdings?

Jason: If we’re just talking about bitcoin itself, I think everyone now realizes that the US government will keep “printing money,” so gold and bitcoin are undoubtedly direct beneficiaries of this macro environment—that’s beyond question. Among the people around me, at least 80% now understand the significance of bitcoin as a “store of value.”

As for their understanding and acceptance of other crypto assets, I think it’s still a “half question mark.” But for me personally, I believe crypto exchanges and stablecoins are the real “business models” in this industry. For those who invest in tech stocks, understanding these models isn’t difficult.

ETFs Reshape Buying Logic; DATs Are More Like Regulatory Arbitrage

Host: You mentioned earlier that the traditional four-year cycle may have failed. But by past experience, bear markets usually last three years, with 70%-80% drawdowns from the top. In the last cycle, bitcoin didn’t even double from its $60,000 high. How do you explain this structural change?

Jason: Yes, I think one of the most important structural changes this cycle is the emergence of spot bitcoin ETFs. This allows institutional investors to enter at scale and in compliance for the first time. This directly led to several key effects:

• Bitcoin has become more stable: Because more long-term, rational institutional investors are involved.
• Funds haven’t flowed into altcoins: ETFs are a “one-way street” into bitcoin; institutional investors don’t like assets without cash flow or intrinsic value. So we’ve hardly seen an “alt season.”
• Mining costs are a strong support: Currently, bitcoin’s mining cost is around $70,000 to $80,000. I’m not saying the price can’t fall below this, but it’s a very strong psychological support, and many institutional buyers use this as their entry range.

These factors together have made bitcoin’s price more stable, making it hard to see the 75% drawdowns of the past.

Host: Since the market structure has changed and volatility has decreased, can bitcoin still achieve 2x, 3x, or even 5x growth after the bear market like before?

Jason: I think the reason bitcoin could rise 5 to 10 times in the past was partly due to high leverage, especially from retail investors. When a lot of shorts get liquidated, it becomes “fuel” for price surges. But now, since ETFs have taken over most of the trading volume, those explosive rallies are much harder to achieve.

So many people are asking whether it’s still possible to outperform bitcoin in the future. The performance of our first fund actually answers this—we outperformed bitcoin by about 60%-70%. The reason, I believe, is that we bet on crypto-related stocks with real value that can be valued using PE ratios. When the market enters an expansion cycle, you benefit from both PE multiple expansion and net profit growth, and this return structure can outperform bitcoin. So I think investing in crypto-related stocks now may be more attractive than before.

Host: You’re very bullish on investing in crypto stocks. But is there systemic risk here? For example, Strategy has hinted that if the stock price falls below NAV, they may have to sell bitcoin to buy back shares. If that happens, could it trigger a crisis of confidence?

Jason: This is indeed a potential risk within the ecosystem, but I don’t think it’s a big problem. First, I would separate Strategy from other Digital Asset Treasuries (DATs). According to their recent disclosures, they have enough cash to pay about 24 months of debt interest, which greatly eases short-term selling pressure.

As for other DATs, I don’t like them when they’re trading at a premium, because you can get the same exposure by investing directly in the ETF. The only difference between DATs and ETFs is that DATs can stake for extra yield, which to me looks more like “regulatory arbitrage.” Currently, most DATs are trading at a 20%-30% discount, which may offer some arbitrage opportunities, but that’s about it.

Overall, I’m not a big fan of Ethereum as an investment theme. If you treat gas fees as Ethereum’s “net profit,” its current valuation is over 100x PE, just like Palantir in the AI sector. Therefore, I prefer crypto stocks like a certain exchange, rather than Ethereum itself.

Value Investing First; Bullish on RWA and Prediction Markets

Host: So, what is the core investment logic of your new fund (Fund II)?

Jason: Our strategy is to go long on targets we believe are undervalued. While I can’t disclose specific listed targets, for example, we recently significantly increased our position in the largest crypto exchange in Korea. This company is valued at about $10 billion, but in 2024 it generated over $700 million in net profit and paid out $200 million in dividends. Its PE ratio is only about 15, while globally, exchanges with real profits usually trade at 30 to 70 times earnings. It’s fully compliant and audited by PwC Korea.

Our fund originally started by buying GBTC at a discount. For me, investing in this exchange is like “GBTC 2.0”—buying a high-quality exchange business at a discount. This is our typical case: value investing first, then talk about future upside.

Host: It sounds like you’re a very disciplined investor, probably due to your traditional finance background. In contrast, crypto investors seem to love leverage.

Jason: Yes, but I think there are three things in crypto that will absolutely “kill” you: leverage, custody risk, and altcoins. If you add one more, it’s “alcohol,” especially during industry conferences. As Charlie Munger said, “Avoid things that can kill you.” If you can successfully avoid these, you’ll be in the top 10% of crypto investors.

Host: Last question: for 2026 and beyond, besides being bullish on bitcoin, what are your other outlooks? Do you think capital will flow back into altcoins?

Jason: Personally, I’m very interested in one particular track, which is the penetration of stablecoins. I see stablecoins as an “upgrade to banks.” When all payment channels and banking systems are upgraded because of this, the transaction costs of the entire financial network will be greatly reduced.

I’m especially focused on prediction markets like Polymarket, and all new trading platforms that may emerge with the rise of stablecoins. I think there will be a lot of innovation here, possibly RWA, or other new business models. Maybe we’ll see the “next-generation Stripe” emerge in the crypto world, because more and more people hold crypto assets and want to use stablecoins for daily payments. These innovations will create real utility value, completely different from the pure Meme narratives we’ve seen in recent years. I’m very bullish on this area, but we need to patiently wait for these companies to mature or go public.