Hyla Fund Management Plans to Become the “Goldman Sachs for Digital Assets” with New Latin American Crypto Fund
Hyla Fund Management, a firm managing $115 million in assets, is set to launch a new crypto fund focused on Latin America. The company aims to become the “Goldman Sachs for digital assets,” leveraging its expertise to invest in the region’s growing crypto market.
Paola Origel, CEO and co-founder of Hyla, highlighted the significant business potential for crypto funds targeting Latin America. She explained that while major funds like Sequoia and Andreessen Horowitz (a16z) have shown interest in the region, the market remains fragmented and challenging to penetrate due to cultural differences. “You really need boots on the ground, people who understand the market and can communicate opportunities to founders,” she said in a recent interview with CoinDesk.
Origel, who hails from Mexico and has 17 years of experience in the financial sector, pointed out that the venture capital scene in Latin America, particularly in Mexico, is underdeveloped. “There are very few venture capital funds; they’re almost non-existent,” she said, adding that she personally scouted the region to identify top fund managers, eventually selecting three based in Mexico City.
The LatAm crypto ecosystem in 2024 bears similarities to the global crypto industry in 2017, according to Origel. At that time, blockchain and crypto service providers were rare, and even basic banking institutions like Wells Fargo struggled to understand the space. “We were the first institutional fund to open a bank account with Wells Fargo because they didn’t understand what it was,” Origel recalled.
Overcoming Education Barriers
One of the biggest challenges in the region is educating investors about cryptocurrencies, which can be difficult to understand because they don’t have a physical form like traditional assets such as gold or cash. “Latin American investors are still very traditional,” Origel noted. “They tell me they only invest in things that they can stand on or things they can touch. We’re trying to change that mentality.” She emphasized that proving the functionality of crypto technologies is crucial to changing this mindset.
A Bridge Between Traditional Investors and Crypto
As a crypto fund of funds, Hyla Fund Management provides a bridge between traditional investors and the rapidly evolving crypto space. Many investors lack the time or expertise to navigate the complexities of the crypto market, making Hyla’s role especially valuable. “The value of a fund of funds is access,” Origel explained. “We’re jurisdiction-agnostic, so we know most of the fund managers around the world, and each manager has their own strategy.”
Hyla is in constant contact with fund managers and the companies they invest in, allowing the firm to offer a unique perspective on the crypto ecosystem. “It’s not a new concept,” said Origel. “Funds of funds have been tried and tested in traditional finance for many years. But in crypto, that approach holds even more value because of how fragmented and complex the space can be.”
Hyla’s vision for the future is clear: the firm aspires to be the “Goldman Sachs for digital assets.” Currently, the firm offers various strategies, including a liquid venture fund and market-neutral yield strategies for bitcoin (BTC) and ether (ETH). The upcoming Latin American crypto fund, which is slated to launch in January 2025, will add an additional $30 million to Hyla’s assets under management.
Why Latin America?
According to Origel, crypto has the potential to transform Latin American economies, helping them transition from being frontier markets to more developed ones. She highlighted the opportunities in the region’s remittance sector, where high fees and inefficient banking systems often make international money transfers expensive. Crypto could provide a more cost-effective alternative.
Origel also pointed out the untapped potential in mobile financial services for peer-to-peer transactions, especially considering the large unbanked population in Latin America. The global shift in supply chains and the rise of entrepreneurial talent in countries like Brazil, Colombia, and Argentina further strengthen the case for investment in the region.
However, she also noted that the market is still in its early stages, which impacts investment decisions. “The market is still so small that you can’t be very picky,” Origel said. “You can’t say ‘Oh, we’re only going to focus on infrastructure,’ because there’s not enough deal flow for that. You need to be open to any sector.”
Origel singled out Brazil for its advanced technological development in the crypto space and Mexico for her local market experience. Argentina and El Salvador are also on her radar, though the quality of a project and the caliber of its team are the primary factors she considers when making investment decisions.
“We want to find the next unicorns that will have not only a regional impact but a global one,” Origel concluded.
