Web3 Investment Guide: How Family Offices Can Allocate Encryption Assets?

In recent years, family offices have gradually transformed from "exclusive asset managers" within elite circles to "asset governance control platforms" in the eyes of high-net-worth individuals. Particularly with the rise of emerging investment paths such as Web3 and RWA, more and more investors are beginning to contemplate: Is it suitable for them to participate through a family office? How should they build it? In the face of the high volatility and complexity of the encryption world, how should they set up structures and allocate paths?

This article will analyze from a practical perspective how family offices are established, used, and optimized as an investment path, aiming to answer three key questions:

1. Who is suitable for adopting the family office path to enter Web3?
2. How to build a practical family office structure?
3. How should family offices formulate Web3 investment strategies and execution methods?

Who is suitable for the "family office path"?

Not everyone needs a family office, as its essence is to serve "governance complexity."

If your assets are more concentrated, your trading frequency is low, and your investment path is relatively simple (such as fixed income products, real estate, domestic funds), then the governance capability of a family office may far exceed your needs, and may instead lead to a bloated structure and higher costs.

But if you belong to the following categories of people, a family office is almost the only path that can balance security, structure, and growth.

1. Large asset volume and complex structure: Investable assets exceed ten million RMB, spanning equity, real estate, overseas funds, and digital assets, involving different currencies, accounts, and holding entities.

2. There is a demand for cross-border architecture: including overseas immigration, offshore companies, non-Chinese tax resident status, as well as scenarios such as overseas investment, identity planning, and distribution of family members.

3. Investment Preference for Structured Products: New structured products in Web3 such as fund-type Tokens, convertible bonds, income certificates, and tokenized equity are increasingly only open to "qualified investors" or legal entities.

4. Need for long-term governance capability: Hope to serve intergenerational inheritance and continuity of family intentions through asset allocation, or allocate long-term assets such as RWA that involve "construction period + operation period + exit period".

The commonality among these groups of people is that: assets are not pursued for short-term gains, but rather to transcend cycles; investment is not about single-point speculation, but rather structural participation.

In this context, the governance structure of family offices is no longer an identity label, but a practical tool.

What should be the core focus when building a "functional" family office?

The establishment of a family office structure is not a one-size-fits-all solution. Its core mission is to "solve real problems". Many people understand a family office as starting from "purchasing a service package" from trusts, law firms, or FO companies. However, a truly effective family office must be "tailored" around your family structure, asset portfolio, and investment goals.

In the context of Web3, a "usable" family office needs to address at least the following four aspects:

The purpose is clear.

Are you looking for tax optimization, cross-border identity configuration? Or to obtain project investment qualifications? Or to set up a portfolio of encryption assets for the next generation? Clarifying your purpose is the starting point for structural design and resource allocation.

Choose the right model

• SFO (Single Family Office): With a capital scale of over 30 million RMB, it is recommended to consider establishing an independent team with autonomous operational capabilities;

• MFO (Multi-Family Office): With funds around 10 million RMB, it may be considered to cooperate with professional service institutions to provide management, compliance, investment research, and other services.

• VFO (Virtual Family Office): Funds are not yet sufficient for independent establishment and can be operated lightly through an outsourced network composed of law firms, trust institutions, and FAs.

• Cross-border SFO (such as those established in Singapore): commonly used to address identity, tax, and investment channel issues, this is currently the most common option for Chinese families.

architecture and legal design

A typical family office structure usually includes:

• Offshore holding entities (such as BVI/Cayman/SPV), used for holding and investment;
• Trust or fund structure for tax optimization and inheritance arrangements;
• Legal advisors and compliance teams for ongoing monitoring and adjustments;
• "Investment vehicle accounts" that interface with Web3 projects, such as enterprise-level wallets and dedicated custody accounts.

professional resource allocation

Having money alone is not enough to establish a family office. It also requires matching roles such as legal, tax, financial, and technical advisors to ensure the structure operates compliantly and investments are implemented smoothly. Many family offices choose to set up entities in Singapore, establishing a financial collaboration team domestically to form "internal and external linkage".

At the same time, building a family office can be roughly divided into three levels:

Layer One: Identity and Structural Framework

• Clarify tax residency status, family member structure, and inheritance path;
• Establish domestic/foreign holding entities, trusts, or SPVs (depending on the type of assets and holding location);
• Solve the compliance path for asset holding, tax declaration, and cross-border circulation.

This layer is the "legal identity credential" for all Web3 investment activities. Especially when you participate in overseas RWA projects, a lack of structure equals "no channel".

Layer Two: Governance Mechanism and Authorization System

• Establish a family deliberation mechanism (such as an investment committee, will, equity agreement);
• Establish an internal and external consulting system (division of roles such as legal, tax, investment, management, etc.);
• Establish an authorization mechanism and supervision process to ensure that "someone is responsible, someone executes, and someone corrects."

This layer determines whether the family office is "operational". If everything relies on individual decisions, the family office becomes virtually non-existent in the event of an accident or exit.

Layer 3: Asset Allocation Strategy

• Set long-term allocation ratios (e.g., RWA 40%, VC 30%, digital assets 10%, cash and liquidity 20%);
• Match the lifecycle rhythms of various assets (construction period, lock-up period, exit period);
• Set up take-profit and stop-loss mechanisms, risk adjustment mechanisms.

This layer is the key to whether family offices can "survive" in the market.

How Family Offices Can Participate in Web3 Investments?

When we say "participate in Web3 through family offices", it is not about switching accounts to invest in projects, but rather about reconstructing your role, path, and strategy. Clarifying the structure is only the starting point; the real core lies in "how to invest".

Web3 investments are characterized by high volatility, high technical thresholds, and changing regulations, and must be addressed through "structured design".

Set Investment Identity

Web3 project identity integration usually includes:

• Direct legal entity (company): Offshore company established by SFO connecting to investment agreement;
• SPV Holdings: Holding assets through a third-party SPV and controlling voting rights;
• Trust Beneficiary: Establishing a trust through a family office to hold Tokens or equity, facilitating tax optimization and intergenerational planning.

It is recommended that family offices collaborate with law firms and compliance agencies to establish identity based on the legal system of the project location, in order to avoid missing investment opportunities due to "ineligible entities."

match asset type

The types of Web3 assets suitable for family office allocation include:

• RWA (Real World Assets): such as tokenized bonds, real estate, income sharing agreements, etc;
• Structured funds: such as yield Tokens, re-staking agreements, yield certificates, etc.;
• Equity-type assets: such as convertible bond tokens, dividend tokens, DAO governance tokens, etc.;

It is not recommended to participate in highly speculative projects that are "not backed by real assets, lack governance structures, and have no exit mechanisms."

Set investment rhythm and risk management mechanism

The biggest difference between Web3 investment and traditional PE/VC is the uncertainty of the rhythm. Family offices should refer to the following mechanisms for allocation:

• Set the "acceptable lock-up period" and exit window;
• Design a "staged release" mechanism to release funds tied to project progress;
• Configure the "Yield Reinvestment" pool to increase investment in quality projects;
• Clarify the tax declaration rhythm and establish reporting and auditing mechanisms.

Governance Participation and Deep Collaboration

High-level family office, not just investors.

• In RWA projects, family offices can serve roles such as auditors, governance representatives, custodians, etc.;
• In the DAO, family offices can participate in governance through token staking and configure a "strategy wallet" for voting;
• In on-chain protocols, family offices can be embedded in collaborative processes as long-term LPs, trustees, and ecosystem collaborators.

This type of "embedded investment" not only enhances the certainty of returns but also makes it easier to form information advantages and reinvestment opportunities.

Common Misunderstandings and Pitfalls to Avoid

As Web3 enters deeper waters, investment is no longer about "whether to invest" but rather "in what capacity and in what manner to invest."

Family offices are a structural vehicle that can support long-term governance capabilities, legal identity allocation, and asset flow pathways.

It allows investors to be not just bettors, but also structure designers, governance participants, and value depositors.

However, many newly established family offices tend to fall into the following misconceptions when approaching Web3:

Misconception 1: Treating family offices as a disguise

Setting up a company without a compliance pathway, financial flow, or tax disclosure will ultimately make it difficult to gain recognition from banks and regulators.

Misconception 2: Lack of investment governance capability

Only one legal entity account is set up, but there is no budget and redistribution mechanism, making it impossible to effectively track and adjust the final investment.

Misunderstanding 3: Blindly pursuing profits while ignoring compliance boundaries

Participated in "unlicensed dividend-type projects"; once regulatory intervention occurs, it will lead to fund freezing or fines.

Therefore, it is recommended that after establishing a family office, at least the following mechanisms should be formed:

• Annual Investment Plan + Analysis Review;
• Clear compliance review + audit mechanism;
• Professional team equipped + Continuous legal advisory.

At the same time, it is again reminded that family offices are not suitable for everyone. They need to match the amount of funds, long-term willingness, and collaborative resources to truly be effective.

Whether to pursue the family office path, the key is not to ask "Do I have money?" but to ask: "Do I need a structure to undertake governance tasks across cycles?"

If the answer is affirmative, family offices are not just wealth containers, but also your long-term base for entering structural investments in Web3.