Almost 100 crypto funds closed in 2023

Bank bank cryptocurrency
Bank bank cryptocurrency

Since the beginning of 2023, a total of 97 out of 700 existing cryptocurrency funds have closed – about 13%. This is stated in the report 21e6 Capital AG, writes Bloomberg.

For the first half of the year, the average profitability of such organizations amounted to 15.2%. During the same period, the Bitcoin index was 83.3%.

The worst results were shown by investment companies with market-neutral strategies – only 6.8%.

During the crisis at the end of 2022, many crypto funds held assets longer than usual, according to analysts. In doing so, they missed out on most of the profits from bitcoin’s rise in 2023.

Some organizations closed after the loss of assets stored on collapsed platforms. In particular, the FTX exchange has been a favorite for hedge funds and professional crypto traders.

According to 21e6 head of marketing Maximilian Bruckner, some firms are “still trying to find new partners” in the banking sector after the closure of cryptocurrency-friendly Silvergate and Signature Bank.

Along with “regulatory uncertainty, the fight for safe exchanges and custodians,” this situation created many obstacles for venture capitalists, Bruckner added.

“Investor confidence has improved slightly, but the influx of funds and the launch of funds do not yet signal a full recovery in sentiment,” he said.

The US is still the dominant jurisdiction for crypto fund managers.

Recall, according to CoinShares, the outflow of funds from cryptocurrency investment products from July 29 to August 4 amounted to $107 million against $20.9 million a week earlier.

Earlier, journalists reported that Sequoia had reduced the valuation of its crypto fund by 66%, from $585 million to $200 million. Sources explained the situation as “the need to reflect changing market conditions.”

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