The company behind Dash, the Dash Investment Foundation, has recently launched a Dash-to-gold rebalancing strategy which will grow its gold and Dash reserves but also reduce volatility.
As we can see from the latest cryptocurrencies news, the company behind Dash claims to be the first ownerless and memberless investment fund in the world. As such, it recently bought its first shipment of physical gold. The move was announced on Friday and marks the launch of its Dash-to-gold rebalancing strategy right before it is deployed to blockchain startups.
In the long term, this strategy aims to grow the value of the capital held by the DIF. The rebalancing strategy was devised by the investment consultant named Demelza Hays, who is also an alumni in Forbes 30 under 30. The goal right now is to accumulate more Dash and more gold in a Dash-to-gold rebalancing strategy covering the two uncorrelated assets.
“The main idea is to sell Dash for Gold when Dash breaches 50% of the portfolio and to sell Gold for Dash when Dash falls below 10% of the portfolio. This ensures a countercyclical trading strategy that sells assets high and buys assets low.”
The completion of this first buy order, from an initial tranche of six, marks the start of a long-term actively managed rebalancing strategy which uses buy and sell triggers. Still, the Foundation only invests capital into the rebalancing strategy when it would otherwise be sitting still.
For those of you who are not following the Dash news actively, it is worth reminding that the company behind Dash allocates 10% of the Dash block rewards through the network’s self-governing treasury system and has a mandate to make money.
There is a further mandate to support the Dash network, so these funds are distributed to blockchain startups in the form of loans or investments. Any project can pitch for funding, which then goes through a 2-step process before it is put to a final decision by the masternodes.
“Any money made on our investments can be used to buy Dash off of the open market, which we then burn. Burning Dash reduces the supply, and theoretically should increase the price of the Dash. This is one way the Foundation can give back to the community without having an ultimate beneficial owner,” Hays noted.
A recent investor call showed that the company behind Dash had seen commercial payments more than doubling on the network with the help of its new retail partnerships in Latin America.
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