What is Countinghouse?
Countinghouse is a tokenized hedge fund that uses algorithmic and code based trading strategies to invest in cryptocurrencies. Each token represents a unit of the fund and represents a defined percentage of the liquid value of the underlying assets.
This article is providing a TECTUS analysis on Countinghouse, for a more thorough overview see my previous article here.
With most current cryptocurrency and blockchain based projects there is a level of technology that needs to be met before a problem can be solved. For example, blockchains need to solve scalability, Oracle, and cross-chain communication issues. This leads to projects with long roadmaps that might not ever be met.
Countinghouse is much simpler in the technological sense in that they are using the blockchain for one of it's most basic functions, proof of ownership. Integrating Countinghouse fund shares with the blockchain is a relatively simple smart contract.
The more complex portion of the project is the collection of trading strategies. However, Countinghouse runs an established FOREX hedge fund utilizing the same algorithms and strategies that have been tested for the past 12 months and tweaked to suit the crypto market.
In addition to the transfer of the strategies from the from the private partnership Dawson Pomery Pogacic (DPP Hedge Fund), the project will be able to start with approximately 90% of the infrastructure complete.
As with the technology, Countinghouse is keeping the token economics fairly simple. There is a single funding event which includes a private and crowdsale. 99% of all tokens will be sold and 1% will fund the team.
This allocation seems strange in comparison to other projects but the only objective of the token sale is to provide Ether to fund the hedge fund. Ultimately the team will make a profit from a 7% monthly commission taken from profit only. This means the team will take no fee during months with losses.
As mentioned earlier the tokens only represent a unit of the fund. The CHT tokens will not pay dividends. When reading this I asked myself, why don't token-holders receive dividends when the team receives a commission?
The answer lies in a unique buyback approach that will purchase CHT from token-holders for the liquidity value at any time. This means that as the fund's net asset value (NAV) increases the liquidity value of CHT will increase. This is similar to Berkshire Hathaway stock, which pays no dividend but instead increases the NAV of the fund.
CHT can also be sold on an open exchange so the buyback only acts as a protection for buyers. When the fund buys back tokens they are never released again.
The majority of competition for Countinghouse lies in traditional hedge funds that are choosing to invest in cryptocurrencies. A traditional hedge fund only allows high wealth investors to participate in the fund.
This is because hedge funds utilize high risk/high reward trading strategies that many regulations limit to those they feel are better set up to mitigate the risk of loss. Countinghouse places the control back onto individual investors of any kind. Participation in the fund is limited only by the requirement to own CHT. If you own 1 CHT you own 1/60,000,000 of the fund's NAV.
There have also been several tokenized funds to enter the market but most are equivalent to a mutual fund rather than a hedge fund. The main difference between these funds and Countinghouse is the use of the hedge fund-style trading strategies that include two-sided arbitrage and alternative investments in cryptocurrency.
The team behind the project created a FOREX based hedge fund under the private partnership of Dawson, Pomery, and Pogacic (DPP). The project supplements their fund team with a partnership with Wisper Connect IT for blockchain and IT services.
Tim Dawson - Director
Mike Pomery - Director
Steve Pogagic - Ethics Manager
The token utility has one purpose, it represents ownership in the fund. If there are 60 million tokens and you own 100,000 CHT you would own the liquidity value of .167% of the NAV.
The utility case for Countinghouse is very simple but effective.
The Countinghouse social presence relies on Telegram and their official blog to answer questions and release statements. The Telegram chat is well moderated by Amazix and team members frequently enter to answer questions. The current Telegram size is 3800+ members. It is important to note that the team is not inflating numbers with a bounty for joining Telegram.
For More Information on Countinghouse
📅Token Sale Dates: June 12
📈Token Ticker: CHT
Website || Whitepaper || ANN Thread || Telegram || Bounty
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