Stock-Picking Vets Readying Fundamental Crypto Hedge Fund With at Least $50M

Blockworks Exclusive: It’s the second recent digital assets-focused hedge fund startup bucking quant algorithms for a discretionary approach


Tephra Digital will be based in New York City and Miami | Source: Shutterstock


key takeaways

  • The founders are betting their equity know-how will translate to winning directional bets in crypto markets
  • The firm is closing in on an institutional investor startup to serve as an anchor investor

Two veteran stock-picking portfolio managers are prepping a cryptocurrency hedge fund that would tap their equities expertise to invest in a fundamental fashion, according to two sources familiar with the matter.

Tephra Digital — named for fertile soil ejected during sporadic volcanic eruptions — plans to launch sometime before the end of the second quarter, sources said. It’s run by Raghav Chopra, most recently a portfolio manager for the $739-billion AllianceBernstein, and Ryan Price, formerly of Riposte Capital.

Chopra and Price worked together for several years at the stock-picking Steadfast Financial.

Tephra plans to start trading with more than $50 million in assets under management, including commitments, and indications are Chopra and Price will look to scale the firm in a sizable way this year. The startup is closing in on a significant anchor investment and also plans to add partner capital and friends and family money into the mix.

Sources were granted anonymity to discuss sensitive business dealings. Chopra and Price declined to comment.

The pair will serve as co-portfolio managers, overseeing a directional, fundamental and concentrated high-conviction strategy that keys in on liquid tokens. It’s a departure from the majority of digital asset funds, which rely on quant algorithms to trade fast-moving markets that don’t sleep.

The idea is to line up long-term limited-partner exposure to high-quality Web3 protocols. The lockup period imposed on investors couldn’t be learned. Chopra and Price are setting up both onshore and offshore vehicles domiciled in Delaware and the Cayman Islands — allowing them to accept contributions from both US and foreign investors.

And it’s part of a growing trend of savvy stock-pickers trying to translate their expertise to crypto markets. 

Factor6 Capital, run by healthcare-focused Ghost Tree Capital alums Ralph Achacoso and Jason Zhang, is betting that institutional investors accustomed to speaking the language of long/short equity will be familiar doing due diligence on the startup.

“There’s a real chance here to break away from all the black box guys,” one source said. “[Investors] don’t really understand what they’re doing. They don’t know how to vet them. It’s a comfort thing, with fundamentals. They know what to do and what to expect.”

Price, who has also spent time at equity hedge fund firms Calypso Capital and Sigma Capital, intends to lean on his background of picking financial technology stocks. Chopra, meanwhile, will look to put his knowledge of trading software and internet stocks to work in Web3 investment opportunities. 

Both have previously personally traded crypto.

The startup is also hiring a number of analysts as well as back- and middle-office professionals on the operational side. It will have offices in New York and Miami.

Chopra, in addition to holding a board seat for crypto miner Argo Blockchain, previously also worked for firms including Carlyle Group, Goldman Sachs and Kanha Capital.

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