Crypto Hedge Funds Raise Millions Despite the Market Dropping
A number of funds are now raising over $100 million from a range of investors.
Crypto Lovers Find Hope In Hedge Funds
From the start of 2018, the crypto market has dipped by approximately 75% in value. Despite the significant decline, cryptocurrency hedge funds are raising millions from investors.
The latest entrant is Grayscale Investment, which has managed to raise over $330 million from multiple investors. The company is a subsidiary of crypto venture Digital Currency Group.
Grayscale recently recorded a 1200% increase in the amount of capital raised in 2017. However, according to MD Michael Sonneshein, the drop in bitcoin's value has not greatly impacted the customer base. He pointed out that asset inflows are sustainable despite the crypto market's performance with investors raising their exposure in the market.
Since its inception, Grayscale has gained a positive reputation in the market as a digital asset management firm. It is not only Grayscale which has managed to raise a significant amount. Pantera Capital has also managed to raise more than $100 million to push into assets.
The cryptocurrency industry peaked towards the end of last year and it has dipped since then. Investors have been exploring many different ways of pumping money into the asset class for long-term opportunities. This sector is being viewed as a hot new opportunity.
The crypto market has recorded four corrections in the last decade. During these periods, the market has dropped by 80% in value each time. According to Travis Kling, the crypto market is the beginning of a major development and the upcoming correction is a chance to bring fresh blood into the market.
Two months ago, Pantera Capital after raising over $100 million, focused on getting another $75 million to set up a venture capital wing to invest in budding crypto companies. More than 140 investors took part in the Pantera Capital offering which has the long-term plan of investing in the crypto sector.
Judging from the last decade, the cryptocurrency industry has managed to come back strong from major corrections and then managed to reach new all-time highs in a consistent manner.
Without a doubt, this year has been bad for cryptocurrencies. However, we are witnessing that the asset category is emerging to bounce back strong with backing from the cryptocurrency industry that is rapidly growing. What we are witnessing is that innovative technology is challenging monolithic centralized systems.