Following the collapse of FTX last year, many crypto funds are holding more cash than usual and have missed out on Bitcoin's rally since early 2023. Meanwhile, other cryptocurrencies (altcoins) have underperformed Bitcoin. According to Bloomberg, crypto funds returned an average of 15.2% in the first half of 2023, underperforming Bitcoin, which gained 83.3% over the same period. Funds with neutral strategies performed the worst, returning an average of just 6.8% in the first six months of the year.
Many funds are still struggling to find new partners for banking services after the closure of Silvergate Capital and Signature Bank earlier this year, said Maximilian Bruckner, head of marketing and business at 21e6. In addition, the legal battle between regulators and exchanges has made it even more difficult for crypto funds. While the launch of new funds is a good sign for investors, the situation has not yet fully recovered, Bruckner added.
Cryptocurrency "winter" is still going on
21e6 tracks the status of more than 700 crypto funds globally, including 123 funds based on data reports from 70 companies.
Earlier this year, crypto investment firm known for betting on Luna tokens Galois Capital closed its fund after being hit by the collapse of crypto exchange FTX.
Digital asset investment firm BlockTower Capital announced the closure of a crypto fund in April. BlockTower Chief Investment Officer Ari Paul said the opportunity for a market-neutral strategy has narrowed significantly after what happened in 2022. Rising interest rates and regulatory scrutiny also contributed to the decision to close the fund. However, BlockTower CEO Matthew Goetz stressed that this was not related to FTX, instead, he said that closing the fund allows the company to allocate time and focus on other, more attractive opportunities.
Source link
Comment (0)