ALTERNATIVE MARKETS UPDATE – END JUNE 2024

​Equity markets have performed very well this year despite the challenging macroeconomic and geopolitical environment. With the exception of a brief correction in April, equities have shown a strong upward trend. This strong positive performance has been particularly pronounced in the US, where the major indices are breaking records on an almost daily basis. The S&P 500 has surpassed the 5,500 mark and is up 15.6% so far in 2024. The Nasdaq Composite is close to the 18,000 mark and is already up 21%, while the Dow Jones Industrial Average has crossed the important 40,000 mark but is only up 3.8% in 2024. Last year's trend also continued with the stellar performance of the Magnificent 7, which have been key contributors to the positive performance of the broader market and other technology stocks, as demand for AI shows no sign of slowing. Figure 1 compares the performance of the Magnificent 7 with the major US indices. Since June 2023, the Magnificent 7 have gained almost 60% compared to 35% for the Nasdaq, 30% for the S&P 500 and 20% for the DJIA.

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RESEARCH PERSPECTIVE VOL. 230 June 2024 Alternative Markets Update Equity markets have performed very well this year despite the challenging macroeconomic and geopolitical environment. With the exception of a brief correction in April, equities have shown a strong upward trend. This strong positive performance has been particularly pronounced in the US, where the major indices are breaking records on an almost daily basis. The S&P 500 has surpassed the 5,500 mark and is up 15.6% so far in 2024. The Nasdaq Composite is close to the 18,000 mark and is already up 21%, while the Dow Jones Industrial Average has crossed the important 40,000 mark but is only up 3.8% in 2024. Last year's trend also continued with the stellar performance of the Magnificent 7, which have been key contributors to the positive performance of the broader market and other technology stocks, as demand for AI shows no sign of slowing. Figure 1 compares the performance of the Magnificent 7 with the major US indices. Since June 2023, the Magnificent 7 have gained almost 60% compared to 35% for the Nasdaq, 30% for the S&P 500 and 20% for the DJIA. Figure 1: Performance of the Magnificent 7, Dow Jones Industrial Average (DJIA), S&P 500 Index, and the Nasdaq Composite since June 2024, Sources: Roundhill ETF, Investing, & Yahoo Finance, June 2024 Cryptocurrency markets also performed impressively last year. The market began to take off when discussions arose about the potential approval of a spot Bitcoin ETF. Over the past six months, crypto adoption sparked further interest, as during this time, Bitcoin and Ether ETFs were approved with new applications for Solana ETFs. Unsurprisingly, this boosted crypto asset prices. For Bitcoin, this led to an increase in market capitalisation from less than $300bn to more than $1.2tn, as shown in Figure 2. More recently, other tokens have attracted more interest, such as Solana (SOL) and Toncoin (TON). Solana, a cryptocurrency that provides infrastructure and is known for its high scalability, has been attractive to developers. Historically, ETH has been the preferred blockchain for developers. Nowadays, Solana is gaining significant market share from Ethereum, which is also reflected in its daily users, which grew to almost 1.5 million in April 2024, compared to around 200,000 in October 2023. This new mass adoption also transforms Solana, once called “the Ethereum-Killer”, into a true rival to Ethereum, as shown in Figure 3. This development has also led to a sharp rise in the price of SOL, which has increased almost tenfold in less than six months. Toncoin is a cryptocurrency developed by the founders of Telegram, the third largest messaging platform with more than 900 million active monthly users. The messaging platform is known for its privacy and strong community involvement. TON is designed to be the native blockchain for Telegram, bringing blockchain technology to nearly one billion people. Due to its effective trade-off between scalability and security, as well as its accessibility, TON has soared in recent months, significantly outperforming Bitcoin. The network of Telegram makes TON especially appealing, as the TON blockchain provides the necessary infrastructure and makes it easy to use. For example, it has its own wallet, which can be managed directly in Telegram and has already 15m users. Telegram’s community also creates an entire ecosystem around the messenger with already more than 300 projects, which range from trading, gaming, NFT marketplaces, and more. Lastly, a major step for the protocol was the introduction of stablecoins to TON and Telegram through Tether (USDt), the largest stablecoin with a market capitalization exceeding $100bn. Figure 2: Market Capitalization and Price Development of Bitcoin, Solana, and Toncoin, Source: CoinMarketCap, June 2024 Figure 3: Solana’s Total Economic Value in Comparison to Ethereum’s Total Value, Source: Pantera Capital, June 2024 STONE MOUNTAIN CAPITAL Stone Mountain Capital is an advisory boutique established in 2012 and headquartered in London with offices Pfaeffikon in Switzerland, Dubai and Umm Al Quwain in United Arab Emirates. We are advising 30+ best in class single hedge fund and multi-strategy managers across equity, credit, and tactical trading (global macro, CTAs and volatility). In private assets, we advise 10+ sponsors and general partners across private equity, venture capital, private credit, real estate, capital relief trades (CRT) by structuring funding vehicles, rating advisory and private placements. As of 2nd February 2024, Stone Mountain Capital has total alternative Assets under Advisory (AuA) of US$ 62.4 billion. 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