Crypto Fund Research, in it’s infographics came to a finding that Cryptocurrency funds now constitute to around 20% of the total hedge fund launches in 2018. This sector has witnessed a great influx of funds which accounts to around 90 currency funds launches by the end of Q3 of 2018, and the number could go to an enormous 120 by the time Q4 gets over.This shall be around 1.69 percent of increase compared to 2017 and around 471 percent increase from 2016.
If we have to account the total number of hedge funds which are projected to go live this year, the number shall be around 600. According to the report:
The research also throws light on the fact that these hedge funds are a part of 622 crypto funds, which itself is a huge number and inclusive of funds based on venture capital and private equity. In total this encompasses to a total worth of 4 Billion USD.
Downbeat Market: Good time to Enter
The inundation of the new crypto funds has happened when the market is predominantly bearish and to a certain extent hostile. The market capitalization of cryptocurrencies has declined by more than 70% this year and was at it’s all-time low in the late 2017.
Another research done and reported by Autonomus Next in the Second Quarter of 2018 throws light on the fact that many cryptocurrencies were also launched during the market uptrend last year but a vast majority has witnessed huge losses which amounted to more than 50%.
The Founder of Crypto Fund Research, Mr. Joshua Gnaizda is positive that these new launches of crypto hedge funds cannot be stopped even if the market conditions are hostile and unfavorable. He is quoted saying that:
“In the midst of 2018’s decline in Traditional Hedge Fund Launches, Crypto Hedge Funds are a notable aberration. Cryptocurrency prices have been in a Bear market for the better part of the year and regulatory uncertainty persists in much of the world….
..While we don’t believe the rate of new launches is sustainable long-term, there are currently few signs of a significant slowdown”
Quarter 3 however has established the worst performance of the currencies and is at an all time low. Exceptionally, Bitcoin was able to create a strong support area below 6000 USD which paved path for theories about it’s value which was said to not go below that. Sources also throw light to the fact that many institutional investors have entered the hedge fund industry, the latest addition being Yale University which invested 30 Billion USD in two crytocurrency hedge funds and this is positively the reason why most of the hedge fund managers want to have crypto assets in their work profiles.
Report: Crypto Funds Make up 20% of Hedge Fund Launches in 2018 (Oct. 14, 2018) Available at: https://www.ccn.com/report-crypto-funds-makes-20-of-total-hedge-funds-launched-in-2018/
Report Published at CCN. Available at: https://www.ccn.com/report-crypto-funds-makes-20-of-total-hedge-funds-launched-in-2018/
80% Down: Ethereum and Crypto Fund Performance, Report Available at: https://mailchi.mp/autonomous/dzhuyclaxu-568373?e=0c5feaccb3;
Also see Ether Tumbles as concern Increases that ICOs are Cashing Out, Camila Russo and Olga Kharif, 14thAug, 2018 Available at: https://www.bloomberg.com/news/articles/2018-08-13/ether-tumbles-as-concern-increases-that-icos-are-cashing-out