A Different Species of Crypto Hedge Fund
Round Opens: October 15, 2025
Subject to Manager’s discretion as disclosed in the PPM.
The Fund is designed to outpace digital assets while limiting their drawdowns.
The Fund actively trades and does not simply buy-and-hold. The Fund does not use shorting, leverage, derivatives, ICOs, NFTs, DeFi, or liquidity pools. The Fund trades spot long digital assets, with U.S. custody and independent fund administration. Investors seeking direct exposure to raw digital asset prices or hedging strategies based on shorting should consider other products.
Why Understory?
The Fund is committed to helping investors increase absolute returns by compounding digital asset appreciation, offering a differentiated source of gains via systematic trading while reducing exposure to market drawdowns.
Strategy Performance
*Live strategy results prior to fund launch, managing $1-4M of individual Ethereum-based accounts (07/01/22 – 01/31/25). Figures represent gross time-weighted returns (TWR), inclusive of principal appreciation. Results do not reflect management fees or fund-level expenses. Past performance does not guarantee future results.
484.6%
Total Cumulative 31-Month TWR*
84.2%
Annualized TWR (CAGR)*
56.4%
Profit During 2022 Market Crash*
7.45
Sharpe Ratio (31 months)*
57.1%
Total Alpha over ETH (31 months)*
16.2%
Annualized Alpha over ETH (CAGR)*
Fund Objective
The Fund seeks to compound investor capital through disciplined active trading rather than passive buy-and-hold exposure. Its goal is to generate superior appreciation relative to underlying digital assets while reducing downside risk. With a two-year investor lock-up, the Fund is structured to convert short-term volatility into durable long-term absolute returns across market cycles.
Fund Strategy
The Fund applies rules-based, mathematically driven filters to identify trend accelerations for precise entry and exit signals. Trades are spot-long with human oversight, maintaining systematic discipline to capture upside volatility across bull and bear periods, consistently outpacing base assets while limiting drawdowns.
Consistency
Reliability is our core advantage. The strategy has proven effective in both bull markets and crashes such as 2022, delivering steady performance across cycles beyond temporary market sentiment.
Predictability
Rules-based mathematical filters isolate trend accelerations, generating disciplined entry and exit signals that capture the safest portion of each move.
Compounding
Moderate gains accumulated over time create durable growth faster and safer than beta exposure. This steady compounding has generated high-velocity alpha year after year.
Fund Details
As of 09/04/2025
Name
Understory Digital Asset Fund, LLC
Regulatory Status
SEC Filing
Access
Currency
USD or crypto in-kind
Minimum
$100,000
Lock-Up
24 months
Jurisdiction
Fund Admin
Custodian
Legal Counsel
AML/KYC
Investors subject to AML/KYC
Financial Auditor
First Round
10/15/2025
FAQ
What are the next steps?
1. Diligence – Ask all your questions and review Fund documentation, discuss investment size and the timeline that would be appropriate depending on your goals.
2. Onboarding – Simple onboarding process with sub-docs and getting
set-up with the third-party admin and accounting so you get your monthly financial reports and K-1s.
3. Invest – Invest via bank wire, check, or In-kind trade like BTC, ETH or USDT.
How is the Fund different from spot crypto or ETFs?
The Fund applies systematic, rules-based trading to capture repeatable gains across cycles and mitigate drawdowns, while most ETFs and spot products provide only raw market exposure.
Do I need to be accredited?
Yes, the Fund is a private placement offering under Rule 506(c) of Regulation D and is open only to accredited investors, with a $100,000 minimum.
Who can invest in the Fund?
The Fund is offered under Rule 506(c) of Regulation D and is open only to accredited investors, with a $100,000 minimum.
What is the Fund’s objective?
To deliver absolute returns by compounding digital asset appreciation through systematic trading instead of passive buy-and-hold exposure.
What is the lock-up and redemption process?
Investments are subject to a 24-month lock-up, with redemptions available thereafter on 60 days’ notice, in cash or approved crypto/stablecoins.
Ready for more due diligence?
Please reach out to the investor relations team at manager@understoryfund.com or call (970)396-9116.