ASC Advisors March 2026 Newsletter
ASC Advisors March 2026 Newsletter
Welcome to ASC Advisors’ monthly newsletter, where we provide thoughts around recent developments affecting the alternative investment management industry, as well as provide updates on our firm and team.
Kevin Warsh, The Next Fed Chair
Market responses to Kevin Warsh’s nomination as the next Fed Chair were mixed, with varied perspectives on whether Warsh will maintain the hawkish perspective he had while on the Federal Reserve Board of Governors from 2006 to 2011 or if he has shifted for a more dovish, lower interest rate outlook. Immediately upon announcement, the dollar strengthened and the Treasury curve steepened.
Warsh will likely push interest rates lower and has pushed for structural reforms, arguing the bank is experiencing “mission creep,” and has overstepped its role due to the Fed’s growing holdings of US Treasury debt and increasing size of its balance sheet. He believes that reducing the balance sheet will make it easier to maintain lower rates.
Warsh’s plans focus on prioritizing price stability and narrowing the Fed’s focus, establishing institutional independence, and how markets react and price in his views leading up to him taking over for Powell will have wide ranging impacts on how managers position portfolios.
The Crypto Crash
Since reaching its record high in October 2025, the crypto market has lost nearly $2 trillion in value. As we noted in our January newsletter, crypto became increasingly aligned with traditional markets in 2025, absorbing the same macro-driven shocks that hit equities and other assets.
We expect the convergence of crypto and traditional markets to continue in 2026 and we are now seeing it transpire with stress over the U.S. dollar and other macroeconomic events that has led to rapid deleveraging and a broad unwinding of risk positions across the digital asset landscape.
For an asset that has been described as digital gold, Bitcoin’s performance has diverged severely from gold over the past several months, and Forbes has reported that it has actually been in lockstep with the dollar’s movement since early 2025. With prices in the $60,000 range, down around 50% from October highs, there is speculation we could be heading into a "crypto winter,” however what that means today with increased institutional ownership and ETF flows will need to play out in the coming months. Money has certainly moved out of the assets, but likely not to a level that suggests long-term investor panic.
Hedge Fund Flows Report
Hedge funds opened the year by extending the wave of capital inflows that followed their strong 2025 performance. January represented the third straight month of net asset growth for the industry, according to estimates from With Intelligence. Long/short equity strategies attracted the largest share of new capital during the month.
Inflows also returned to CTAs, relative value, and event-driven funds after experiencing redemption pressure at year-end. The multi-strategy segment recorded the highest percentage of funds raising capital in January. Preliminary data indicates that Asia-Pacific led all regions in asset flows.
For full-year 2025, hedge funds generated an estimated $46 billion in net inflows — the strongest year for capital raising in more than a decade. This rebound follows three consecutive years of industry-wide net outflows, according to With Intelligence.
The Software Crush + Tech Corrections
Recent corrections across technology and software stocks have reignited discussions around AI valuations. Many software and AI-related companies have seen their valuations decline by 10% to 20% or more, as investors grow more cautious about the pace at which heavy AI investment will translate into real financial returns; NVDA was down -5.41 in the recent five days.
Moving forward, AI’s impact on traditional software business models, and how increasingly capable AI tools become at automating tasks, writing code, and replacing functions that previously required multiple software platforms, will determine the extent of areas of correction if these trends continue. While these sectors have felt pressure in the first two months of ’26, a shift to defensive and value-oriented areas of the market have seen inflows and increased valuations.
Reporters are following every move closely, and reporting on many analyst views on whether this correction is a healthy reset or a structural rotation.
The Rise of AI-Generated Content
AI is changing the landscape for how LPs learn about investment opportunities and conduct due diligence, as well as how information is sourced and search results are compiled online. As a result, how firms manage their public profiles can have an outsized impact on information gathering and search results across the GEO (Generative Engine Optimization) landscape.
In our latest white paper, Grokipedia and the Rise of AI-Generate Content, we discuss the dynamic search evolution and actions firms can take to help better position themselves within LLM generative engines. While remaining strategic in where and how a firm is mentioned or covered across digital assets, a hands-off approach with the goal of remaining under-the-radar is becoming increasingly more difficult and risky.
Firm News
South Florida Conferences
Max Rayden attended the inaugural Wall Street Journal 'Invest Live' event at The Palm Beaches. WSJ editors and reporters sat down with a select group of investors, advisers and policymakers for candid discussions on public markets, venture capital, private equity. We look forward to attending next year's event.
Keely Gispan once again participated in Uncorrelated Alts Miami 2026 at The Ritz-Carlton in Miami Beach. A counter to the larger alts conferences, Uncorrelated focuses on niche, capacity-constrained, and differentiated strategies across private equity, hedge funds, real estate, private credit, venture capital, and digital assets. We look forward to attending every year.
New York City Events
New York City EventsASC attended The 35th annual McDermott Will & Schulte Private Capital Forum, an event designed for GPs, LPs, advisors, and sponsors. The Forum delivers practical takeaways on regulatory developments, market trends, and private credit. We had a wonderful time connecting with both clients and friends.