Cryptocurrency research firm Crypto Fund Research reports that prices for cryptocurrencies like Bitcoin and Ethereum are off about 50 per cent from their December 2017 highs and the SEC has announced its intent to investigate over 100 crypto hedge funds.
“Yet those hurdles haven’t slowed the explosive growth of new crypto investment funds launching across the US,” the firm says. “With over 100 new crypto fund launches, 2017 was a record year for the industry. The explosive growth of the cryptocurrency and blockchain investment universe has continued in 2018.
“Already there have been 34 new crypto fund launches this year, putting 2018 on pace to meet or exceed the record 107 launches in 2017.”
Josh Gnaizda, founder of Crypto Fund Research, says: “While crypto hedge funds constitute a small portion of hedge fund assets, they are one of the fastest growing sectors in the hedge fund industry. In addition, many venture capital funds are including cryptocurrency and blockchain assets in their existing portfolios or creating new funds specifically to invest in digital assets.”
The firm writes that while accounting for 14 per cent of new hedge fund launches may not seem like much, consider that crypto funds have less than 0.1% of total hedge funds assets.
“In fact, crypto hedge funds are the fastest growing segment of the hedge fund industry. In addition, several of the top performing hedge funds in 2017 were cryptocurrency funds.”
Crypto Fund Research estimates there are currently more than 276 cryptocurrency/blockchain investment funds. The majority are set up as hedge funds, while a large number are venture capital crypto funds. There are also a handful of crypto ETFs and crypto private equity funds.
