Crypto Hedge-Fund Bubble to Deflate, Bloomberg Thinks

According to Bloomberg, at least nine funds have been shuttered so far this year and funds have losses of 23 percent in 2018, industry tracker says
03 April 2018   405

In 2017 on the background of an impressive price jump of bitcoin, more than 150 hedge funds were launched, thanks to which many institutional and private investors paid attention to cryptocurrencies. However, since December the bitcoin rate has more than halved, forcing investors to start thinking twice before placing their funds in similar enterprises, Bloomberg writes.

New capital has slowed, even for a higher-profile fund like ours.

Kyle Samani

Co-founder of Multicoin Capital

 This fund was launched in August last year and has about $ 50 million under management.

At the same time, such a noticeable decrease in the price of bitcoin and other cryptocurrencies resulted in at least nine funds, including Crowd Crypto Fund and Alpha Protocol, are stopping their work, removing websites and accounts from social networks.

Considering the potential regulatory and market risks, AlphaProtocol has decided that the best approach is to refund the private sale contributors.

Alpha Protocol Team

Polychain Capital, as of September 2017, is probably the largest cryptocurrency hedge fund with about $ 250 million under management, in January, decided to refuse to enter the stock exchange in Canada. Even earlier, in December, billionaire Mike Novogratz refused plans to launch a crypto fund, directing efforts to create a trading crypto-currency bank and investments in related technologies. 

According to Lex Sokolin, director of financial engineering at Autonomous Research, until the end of 2018, up to 10% of all crypto funds may be terminated, while Rick Marini from Protocol Ventures believes that only 50 funds will be able to attract sufficient external capital to lead sustainable business. The remaining funds, he said, will have problems.

Nevertheless, even against the background of lower prices, optimists are still present. In particular, they see the potential in the blockchain techology, as well as in such crypto-currencies as Ethereum, Ripple and Litecoin.

According to Marini, now he receives on average three pitches from new crypto-currency funds. He usually meets representatives of two of them, but he plans to invest only in one or two in 2018.

Barclays to Freeze Crypto Trading Project

This is reported by two anonymous sources to Financial News London
15 October 2018   100

One of the largest UK bank Barclays has suspended work on its own crypto-trading project, Financial News reports citing two sources familiar with the situation.

Earlier this year, the bank gathered a high profile team to explore opportunities for cryptocurrency trading as part of its own business. However, according to one source, the initiative was “frozen”.

The former head of Barclays for energy trading, Chris Tyrer, who headed the “digital assets project,” left the bank in September after management decided to freeze the initiative.

Together with Tyrer, the macro-strategy in the field of foreign exchange and emerging markets was Marvin Barth, Senior Technical Specialist Lee Brain, and Consultant Matthew Jobb Duval.

Their task was to determine whether cryptocurrencies are an asset class with far-reaching prospects, whether Barclays customers are interested in them and what type of IT infrastructure will be needed to work with them, the source said.