Strix Leviathan: the crypto quant fund that’s beating the market with a differentiated investment approach

Career dotcom entrepreneur and serial bootstrapper Jesse Proudman is the co-founder of Strix Leviathan, a quantitative hedge fund that’s beating the market through software and systematic investing.

“Strix Leviathan” etymology

Like so many entrepreneurs, Proudman may have found his initial concept as a reward for past struggles. Before his last company Blue Box was acquired by IBM in 2015, Proudman spent almost a decade scraping together funding to keep the private cloud-as-a-service platform running—until the firm had graduated from the tenuous years of bootstrapping to the world of VC funding.

In 2015, post-exit, he joined IBM as a “Distinguished Engineer” focusing on crypto and blockchain research and developed an incredible fascination that would eventually form the thesis behind Strix Leviathan. According to Proudman, he began to see visible patterns after analyzing crypto charts with the following assumptions:

“This asset class lacked valuation models that were shared among market participants. This resulted in price discovery that’s largely speculative and highly reflexive. At the same time, these markets offer relative liquidity and trade 24 x 7 x 365.”

In January 2018, Proudman and one of his long-time colleagues at Blue Box and IBM, Sadie Raney, bid farewell to Big Blue and co-founded Strix Leviathan as their next adventure. Two months later, the quant fund-in-making closed a $1.6 million seed round sponsored by venture funds including San Francisco-based Liquid 2 Ventures, Seattle’s Curious Capital, Future Perfect Ventures, and angels including ex-Seahawks player Doug Baldwin and Orion Henry, founder of Heroku.

Fundamentals follow price

There’s something philosophically quantitative about Strix’s approach to the crypto market, beyond running a fund where algorithms determine investment decisions and human judgment is minimized.

Proudman and his team question the notion that fundamentals play a role in the price of cryptocurrencies—at…

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