Crypto Hedge Fund Split Capital Winds Down as Founder Zaheer Ebtikar Joins Stablecoin Startup Plasma

Zaheer Ebtikar, founder of crypto hedge fund Split Capital, announced on April 7, 2026 that he is winding down the fund and joining stablecoin blockchain startup Plasma as Chief Strategy Officer, despite delivering approximately 100% returns in 2024 and 20% in 2025.

Ebtikar cited structural shifts in the crypto industry, including the rise of spot Bitcoin and Ethereum exchange-traded funds from BlackRock and Fidelity, as reasons the hedge fund model is no longer viable, while Plasma prepares to launch a consumer neobank app called Plasma One.

Split Capital Delivered Strong Returns but Closes Due to Industry Shifts

Split Capital launched in January 2024 during a slow period in crypto markets, operating on the thesis that venture capital would flow toward undervalued liquid tokens. The fund attracted limited partners including Novi Loren and UTXO Management and held eight-figure assets under management. Split Capital delivered net returns exceeding 100% since inception, with virtually every investor turning a profit.

Ebtikar stated that the hedge fund industry in crypto is “down and out” and that the fund’s closure was not due to lack of success. He argued that the industry no longer rewards traders chasing momentum as the sector matures. More than $100 billion in venture funding entered the space over six years, and the market returned to what Ebtikar called a “humbling baseline.”

Split Capital returned outside capital to investors in late 2025 and began winding down as a full fund vehicle. The fund will continue in a limited capacity using only proprietary capital. Ebtikar’s decision reflects a broader retreat among crypto’s top venture firms. Paradigm has expanded into artificial intelligence and robotics. Multicoin’s Kyle Samani shifted focus, and Dragonfly’s Rob Hadick described the current moment as a “mass extinction event” for crypto venture capital.

Ebtikar Joins Plasma as Chief Strategy Officer Ahead of Neobank Launch

Plasma is an EVM-compatible Layer 1 blockchain built for stablecoin settlement and distribution, designed for high throughput, near-zero fees, and gasless transfers for assets like USDT. The protocol uses a split-block architecture to resist spam. Backers include Peter Thiel’s Founders Fund, Tether CEO Paolo Ardoino, Bitfinex, and Framework Ventures, which led a round of approximately $20 million to $24 million.

Ebtikar had been an early backer and advisor at Plasma since mid-2024 after meeting CEO Paul Faecks. He invested personally and helped with fundraising, hiring, and strategy. On April 7, 2026, he joined formally as a founding team member and Chief Strategy Officer. His role includes leading senior partnerships, investor relations, and product go-to-market strategy.

His primary focus will be the launch of Plasma One, a consumer app described as a stablecoin-powered neobank aimed at competing with SoFi and Revolut for global payments, savings, and financial access. Ebtikar called Plasma “what I believe will be the best company in crypto” and described joining the team as the culmination of nine years in the industry.

Spot ETFs and Institutional Access Reshape Crypto Investment Landscape

Ebtikar pointed to spot Bitcoin and Ethereum ETFs offered by BlackRock and Fidelity as a key reason the hedge fund model lost its edge. When financial giants refused to touch cryptocurrencies in the 2010s, hedge and venture funds took on the risk of directly holding large tokens, giving rise to stalwart investors such as Pantera Capital. Now, institutional investors can gain exposure to digital assets through regulated ETFs.

Ebtikar believes that the next phase of crypto will be defined by builders rather than traders, with stablecoins emerging as the sector’s largest practical use case, processing trillions in settlement volume annually. Plasma is positioning itself as the settlement layer for that activity. No regulatory issues or investor disputes were cited in the fund’s closure.

FAQ

Why did Split Capital close despite strong returns?

Split Capital delivered approximately 100% returns in 2024 and 20% in 2025, but founder Zaheer Ebtikar closed the fund due to structural shifts in the crypto industry. He cited the rise of spot Bitcoin and Ethereum ETFs from BlackRock and Fidelity, which give institutional investors direct access to crypto without fund managers, as well as a broader retreat among crypto venture capital firms.

What is Plasma and what will Ebtikar do there?

Plasma is an EVM-compatible Layer 1 blockchain built for stablecoin settlement with near-zero fees and gasless transfers. Ebtikar joins as Chief Strategy Officer, leading senior partnerships, investor relations, and product go-to-market strategy. His primary focus is Plasma One, a consumer neobank app competing with SoFi and Revolut.

What backing does Plasma have?

Plasma’s backers include Peter Thiel’s Founders Fund, Tether CEO Paolo Ardoino, Bitfinex, and Framework Ventures, which led a round of approximately $20 million to $24 million. The protocol uses a split-block architecture to resist spam and is designed for high-throughput stablecoin settlement.