- Hedge funds plan to ramp up their crypto holdings to greater than 7% of property by 2026, a survey confirmed.
- That will equate to round $313 billion of cryptocurrency holdings, Intertrust Group mentioned.
- Hedge funds have been drawn to the volatility and large value rises in cryptocurrencies reminiscent of bitcoin.
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Hedge fund bosses are planning to ramp up their holdings of cryptocurrencies, predicting that a mean of seven.2% of their property underneath administration can be held in digital tokens by 2026, a survey has discovered.
That will equate to round $313 billion of cryptocurrency holdings, primarily based on an estimate of the longer term measurement of the hedge fund trade, in line with Intertrust Group, which carried out the analysis.
The discovering is an indication that many potential institutional consumers usually are not being delay by bitcoin’s recent plunge, however see cryptocurrencies as a long-term technique.
“Sure cryptocurrencies, reminiscent of bitcoin and ethereum, have delivered unimaginable – albeit risky – efficiency lately,” mentioned Jonathan White, world head of fund gross sales at Intertrust, a Netherlands-based skilled providers group.
“Inevitably, they’ve drawn rising curiosity from hedge funds in addition to institutional and retail buyers.”
Intertrust’s survey, first reported by the Monetary Instances, discovered that one in six respondents anticipate their funds to have greater than 10% in cryptocurrencies in 5 years’ time. Simply shy of all respondents mentioned they anticipate to have at the very least some crypto investments by then.
The corporate polled 100 chief monetary officers at hedge funds world wide, with common property underneath administration of $7.2 billion.
North American hedge funds had been probably the most bullish on crypto, predicting that they might maintain round 11% of their property in digital tokens by 2026.
Given the secretive nature of the hedge fund trade, it is unclear how a lot crypto publicity these establishments at the moment have. But most hedge funds which have moved into the house have solely dedicated a small quantity. For instance, Brevan Howard plans to invest as much as 1.5% of its principal $5.6 billion fund in cryptocurrencies, it mentioned in April.