As blockchain-native investment clubs have gained traction in the last six years, the appetite for digital ventures grew proportionally and investors jumped aboard in a pursuit to find value in crypto, NFTs and other assets. While DAOs (decentralized autonomous organizations) are bringing much innovation and opportunity to the game, the idea of collective investment is not at all new.
The first modern investment funds were established quite a long time ago in the Netherlands — after the financial crisis of 1772–1773. Back then, the dutch businessman Abraham van Ketwich founded the Amsterdam-based trust fund called Eendragt Maakt Magt (Unity Creates Strength). From the beginning, the idea was to provide independent investors with an opportunity to diversify and have access to bigger investments. A lot has happened since then and the investment space kept on evolving. Let us have a thorough look at the past, present and future of investment funds.
Past, Present & Future
After the Netherlands paved the way, the idea of collective investment spread across the world. People quickly understood the many advantages of pooling their funds together and operating with better knowledge and more resources. About a century later, mutual funds were introduced to the USA. Further down the line, in the 1960s, collective investment clubs became more popular to the wider audience, not solely to wealthy individuals and people working in the finance industry. Throughout the next decades, towards the end of the 20th century, the investment sector grew significantly, in part due to the two bull markets that took place in the 1980s and 1990s. In that period, the S&P 500 index grew two-fold and four-fold respectively. People all over the world were now starting to pay attention to this prosperous method of investing.
Today, the more traditional forms of collective investment like hedge funds or bank-administered trusts are losing ground to blockchain-based investment clubs.
The new form of digital investment is disrupting the sector for the better, offering independent investors performant tools and leverage they could not previously benefit from. There has never been a better time for people to join or create investment clubs for investing and trading in digital assets — and also common stocks and commodities. Going forward, platforms like Unique.vc — a Solana based dApp — are bound to elevate the investment space, bringing much innovation, transparency and efficiency to the way people are investing and trading. But what makes it special and how exactly is the investment space evolving?
How Is the Investment Sector Evolving?
Nowadays, we tend to take for granted the many advantages investment clubs are offering. But it wasn’t always like this. For instance, investing with hedge funds was only suitable if you possessed significant capital. The small profit margins that hedge funds manage to obtain work great if you are investing millions. However, small, independent investors are left outside, not being able to benefit. On the other hand, bank-administered trusts operate inefficiently due to extreme bureaucracy that makes the investment process sluggish. Moreover, investors face a heavy decision-making process, not having the freedom that modern investment clubs offer.
But fortunately, investment is evolving into a more inclusive and performant space. Nowadays, the idea of investing cannot exist without offering freedom, accessibility and performant tools. On platforms like Unique.vc, independent investors can easily gather in large numbers and pool their funds together fast and efficiently.
Some of the world’s most prestigious DAOs have been established and funds have been gathered in a number of days. The whole investment medium is hyping up, and slow traditional methods cannot keep up with the dynamics of crypto and NFTs.
What about the important decision-making process? Unique.vc is also pushing forward several governance and voting systems that are suitable for DAOs, gaming guilds, NFT collector clubs or other forms of investment clubs, like syndicates and VC funds. Decision-making and treasury administration is now literally an instant and transparent process where people from all over the world can have a say and move forward with confidence, in a timely fashion.
The Promising Future Ahead
It’s worth remembering how collective investment started in the first place — right after a financial crisis that took place towards the end of the 18th century. It’s exactly in these challenging moments that smart investors find a better way forward. In order to succeed, one must learn to adapt, make changes and rethink their approach. Having the right partners and tools by your side is of course equally important.
We are going through a bear market right now and rumors of an even bigger financial collapse are circulating all around. While the majority of people worry about the future and decide they better freeze their investment, smart investors gather in investment clubs and plan for the road ahead. As big challenges are around the corner, even bigger opportunities shape up in the near future. It’s enough to look back in history to understand that the economy as a whole and the stock and crypto markets have a cyclical behavior. But who will be in a position to profit?
With platforms like Unique.vc, the path to digital investment looks promising. Investors must learn to leave behind what doesn’t serve them anymore and embark on a new journey that is now taking off. Crypto, NFTs and the Web3 space offer a new dimension for creating value. The traditional investment mediums have not been designed for “The New Internet”. Value cannot exist without trustful partners, agile tools and a clear vision for innovation. In the end, let us all remember what people already knew centuries ago — the first investment fund in history was called “Unity Creates Strength”.