Episode 34 - Navigating the Future of Digital Assets

The Gage

We had the pleasure of speaking with Colin Jones, PhD, Founder and Chief Investment Officer of Outerlands Capital in this Episode of The Gage. Colin and our CEO, Sean Kiernan first met through Hub 71, an Abu Dhabi incubator program, where he shared his insights with member companies. Today, he joins us from Notre Dame, Indiana, where he reflects on his journey into the world of digital assets.

Colin's background is fascinating; he spent over a decade as a finance professor at the University of Notre Dame, where he developed a passion for digital assets that began in 2013. After feeling a bit stagnant in academia, he sought a new challenge and joined Horizon Labs, a blockchain development company. There, he built the investments team and engaged in various activities, from tokenomics advisory to managing the balance sheet. This experience ultimately led to the founding of Outerlands Capital in the summer of 2023, where he focuses on creating high-quality portfolios of liquid digital assets aimed at institutional investors.

During our conversation, Colin shared his early experiences with digital assets, including a memorable encounter with a student who introduced him to Bitcoin. He described how the volatility of Bitcoin fascinated him and how the emergence of Ethereum expanded his understanding of programmable money. Colin also discussed the evolution of his teaching, where he offered courses on digital assets, and how some of his students have gone on to successful careers in the crypto space.

One of the key themes of the discussion was the importance of research in the digital asset space. Colin emphasized that many investors dismiss crypto as mere "meme coins," overlooking the significant value being created in the Web3 movement. He highlighted Outerlands' commitment to rigorous research, including studies on diversification in digital assets, which revealed that diversification works similarly in crypto as it does in traditional asset classes.

Colin also shared insights into the construction of portfolios for institutional clients, noting that many allocators currently have zero exposure to digital assets. He suggested that a 1-5% allocation to digital assets could enhance overall portfolio performance, especially given the asset class's potential for explosive growth. We discussed the role of governance tokens and the need for well-structured tokens that provide real value and control to investors.

Colin expressed an optimism about the future of digital assets in the U.S., especially in light of recent political developments and the growing acceptance of crypto among institutional investors. He encouraged listeners to remain open-minded about Web3 and decentralization, emphasizing the transformative potential of allowing individuals to take control of their own assets and data.

This episode is a must-listen for anyone interested in the intersection of finance and technology, as Colin provides valuable insights into the evolving landscape of digital assets and the opportunities that lie ahead.

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About Outerlands Capital:
Outerlands Capital is a cutting-edge digital asset manager, originally the investments team of Horizen Labs. Combining blockchain development expertise with institutional finance experience, Outerlands Capital provides diversified exposure to long-term blockchain innovation.

Their investment strategies leverage data-driven, systematic portfolio construction, deep fundamental research, and proven risk mitigation processes, ensuring a structured and informed approach to digital asset management.

For more information, visit https://www.outerlands.io/

Time stamps
00:00:00 - Introduction to Colin Jones and Outerlands
00:00:49 - Colin's Journey from Academia to Digital Assets
00:02:40 - The Vision of Outerlands Capital
00:04:15 - Student Reactions to Digital Asset Classes
00:05:39 - Research Focus and Insights at Outerlands
00:10:41 - Historical Context of Digital Assets
00:11:09 - Accessing Research and Reports
00:11:41 - Portfolio Construction and Digital Asset Allocation
00:14:04 - The Role of Governance Tokens
00:15:59 - Active vs. Passive Management in Digital Assets
00:18:00 - The Current Mood in the U.S. Crypto Landscape
00:19:51 - Closing Thoughts on Web3 and Decentralization