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Technology Crypto Funds Are Closing While the Biggest Investors Stand Aside

12:11  04 december  2019
12:11  04 december  2019 Source:   bloomberg.com

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Investors – We help investors to source and filter new potential investments across hundreds of crypto hedge funds , venture capital funds , and other crypto investment managers. It appears they’ll need to keep waiting a little longer, with nearly 70 crypto -focused hedge funds that mostly cater to pensions, family offices and wealthy individuals closing this year, according to San Francisco-based Crypto Fund Research. The number of new fund launched is less than half the amount started in 2018, the researcher said…

Almost 70 funds have closed in 2019, Crypto Fund Research says. Fidelity, futures exchanges continue to court professionals. Listen to article. “Just wait until institutional investors jump in” has long been a rallying call for the cryptocurrency faithful. It appears they’ll need to keep waiting a little longer, with nearly 70 crypto -focused hedge funds that mostly cater to pensions, family offices and wealthy individuals closing this year, according to San Francisco-based Crypto Fund Research.

(Bloomberg) -- “Just wait until institutional investors jump in” has long been a rallying call for the cryptocurrency faithful.

It appears they’ll need to keep waiting a little longer, with nearly 70 crypto-focused hedge funds that mostly cater to pensions, family offices and wealthy individuals closing this year, according to San Francisco-based Crypto Fund Research. The number of new fund launched is less than half the amount started in 2018, the researcher said.

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In March, three crypto startups raised some of the largest capital raises in the industry’s history. Here are the top ten. Founded in 2017, New-Jersey based BlockFi is now one of the leading cryptocurrency lending providers. Its products span multiple categories including crypto -collateralized loans and interest-bearing accounts through which investors can earn interest on their crypto holdings.

The Funds closing are as follows: Fund . Leveraged ETFs are not suitable for all investors and should be utilized only by investors who understand the risks associated with seeking The firm holds a short position in Lordstown, so it stands to gain from a drop in the shares. While the truckmaker’s chief executive denied the allegations Bitcoin Hoard Fuels One of World’s Biggest Crypto Fortunes.

The retrenchment comes amid another volatile year for cryptocurrencies, with Bitcoin and its peers once again posting the kind of swings that make institutional investors uncomfortable. While high-profile advocates such as Fidelity Investments and the New York Stock Exchange’s parent company plow ahead with initiatives seeking to make it easier to own digital assets, their potential customer base seems to be disappearing at a quick clip.

“The market is definitely retail driven and will remain so for the foreseeable future,” said Nic Carter, co-founder of Boston-based crypto market tracker Coin Metrics.

a close up of a logo: 2019 Crypto Fund Closures by Region© Bloomberg 2019 Crypto Fund Closures by Region

At the same time, one of the other projected lures for professional money managers -- regulated futures -- continue to be greeted with a muted response.

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Rich Crypto Investors Going Alone Gets Goldman Off Sidelines. Goldman Sachs Group Inc. said this week it’s close to offering investment vehicles for Bitcoin and other digital Still, none of the biggest U.S. banks currently provide direct access to Bitcoin and the likes. Dart, who was drawn to crypto after his sister successfully invested in Bitcoin in 2014, has now set aside a small percentage

The crypto carpet has had people divided into supporters and naysayers. While some turn away from cryptocurrency, others are nosediving in. As it would eventually turn out, some nation's loss may turn out to be another's gain. At this critical juncture, the standing of every economy with regard to cryptocurrency will turn out to be a landmark decision in view of the future. A share sale could help AMC shore up its finances that have been hit by pandemic-related closures and delays in the launch of big movies as well as the growth of online entertainment providers.

Trading volumes on Bitcoin futures on exchanges like Chicago Mercantile Exchange and Bakkt, which began offering futures that settled in Bitcoin in September, have increased, but are still relatively low. CME’s daily volume this year averaged about 32,500 Bitcoins, or $236.8 million at current prices, with more than 3,500 individual accounts trading, the company said in November.

That’s just a drop in the bucket compared with the volume on less-regulated trading platforms outside the U.S. Aggregate Bitcoin futures volume -- mostly on exchanges letting any retail speculator buy contracts with as much as 125 times more money than they put down -- exceeds $10 billion a day, according to tracker Skew.com.

That hasn’t stopped Fidelity from joining long-time crypto advocates such as Michael Novogratz and the Winklevoss brothers from building out services such as custodial storage to make institutional investors more comfortable owning digital assets. Fidelity said recently that growth is exceeding internal expectations without providing specifics.

Billion-Dollar-a-Day Crypto Trader Finds Accolades Are Better Than Anonymity

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“Unlike other funds that may invest in diversified assets, the Trust’s investment strategy is concentrated in a single asset within a single asset class. This concentration maximizes the degree of the Trust’s exposure to a variety of market risks associated with bitcoin and digital assets.” Firms with an established ETF presence and broad distribution would have the advantages over others.” As noted, some half dozen firms have filed with the U.S. SEC for crypto ETFs this year. Could any of them beat Fidelity to the punch, and if so, would they have anything close to the impact of a Fidelity ETF?

Either way, investors say they expect managers to put up significant portions of their net worth into the fund . "If I'm going to put my or my clients' money in it, I certainly need to know how invested you are ," Doherty said. New managers need at least a performance record of at least three years to show potential investors , O'Callaghan said. Some hedge funds don't let their traders take their performance sheets with them, so they might need to manage money on their own for a while to build up a fresh record.

“It’s not a stampede by any stretch, but people are all doing their work,” Novogratz, chief executive officer of Galaxy Investment Partners LLC, said in a recent interview. “The next wave will come from the wealth advisers, maybe with endowments and small foundations participating.” In November, Galaxy launched two new Bitcoin funds for institutional investors, such as high net worth individuals.

a screenshot of a cell phone: Crypto Fund Launches by Year Plummet© Bloomberg Crypto Fund Launches by Year Plummet

Two pension funds of Fairfax Retirement System recently increased their exposure to the industry. Earlier this year, Harvard University’s endowment backed Blockstack Inc., a crypto company. Institutions’ investments into cryptocurrencies are likely to increase over the next five years, according to a Fidelity survey earlier this year

Regulatory scrutiny is to blame in large part for the hesitant steps, as governments try to stop rampant scams and companies like Facebook Inc. from usurping too much power. The resulting uncertainty, as well as cryptocurrencies’ inherent volatility (Bitcoin has nearly doubled since the beginning of the year, but is down by more than 40% since its peak in June) are likely to continue to give many investors pause.

“Taking a step back, I think some would argue that the levels of institutional adoption are disappointing or underwhelming but, of course, this view depends entirely on expectations,” said Spencer Bogart, general partner at San Francisco-based Blockchain Capital LLC. “To me, the fact that there is any institutional adoption for Bitcoin only 10 years into existence is a radical success and beyond what anyone could have imagined just 3 or 4 years ago.”

To contact the reporter on this story: Olga Kharif in Portland at okharif@bloomberg.net

To contact the editors responsible for this story: Jeremy Herron at jherron8@bloomberg.net, Dave Liedtka, Brendan Walsh

For more articles like this, please visit us at bloomberg.com

©2019 Bloomberg L.P.

Bitcoin money laundering is a classically stupid crime .
On the bitcoin network, anybody can see your transactions, including law enforcement. It's almost as bad as leaving your fingerprints at the scene of a crime.According to the United Nations Office on Drugs and Crime, it’s estimated that 2% to 5% of the global GDP—or $800 billion to $2 trillion—is laundered each year, much of it in cash. But over the last few years, with cryptocurrencies growing in prominence and price, they’ve become a popular option, too. Government agencies have started contracting crypto-analytics firms like Chainalysis and CipherTrace to track down money launderers and other criminals.

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This is interesting!