Split Capital Founder: Hedge Fund Model is Outdated for Crypto Market

Zaheer Abtikar, the founder of Split Capital, has decided to shut down his hedge fund, revealing that the traditional hedge fund model does not align with the evolving landscape of the cryptocurrency market.

Launched in 2024, Split Capital recorded impressive performance with a net return of 100% during its tenure. Despite its success, Abtikar believes the fund structure is unsustainable for the future of digital assets.

He pointed out that the cryptocurrency sector is characterized by rapid changes and fragmentation, and that it integrates aspects of both venture capital and public markets. According to Abtikar, many creators in the space are merely replicating existing business models rather than innovating. This decline in originality has made liquid token markets the primary avenue for long-term investments, with many choices focusing on quick profits rather than fostering sustainable products.

"After more than $100 billion in venture funding and six years of euphoria, we have returned to a humiliating baseline. Investors are questioning the future and the sources of true value," he stated.

Shifting his focus, Abtikar plans to join the stablecoin settlement initiative Plasma, where he will serve as strategic director. He describes the stablecoin sector and Plasma’s potential to significantly scale, addressing a growing demand for "trillions of dollars in settlements" linked with conventional finance.

Additionally, in March, Sami Start, founder of Transak, indicated that venture funds have become more discerning, leading to fewer investments in the cryptocurrency space.