PwC notes growing confidence of hedge funds in crypto


Hedge funds are confident in the value proposition and long-term sustainability of digital assets. These conclusions were made by PwC specialists together with the Alternative Investment Management Association and CoinShares.

This attitude was not affected by the reduction in 2023 of the share of structures that invest in cryptocurrencies, from 37% to 29%.

93% of respondents expect the digital asset market capitalization to increase by the end of the year.

“Most of the respondents received a positive alphahighlighting the important role these firms play in the ecosystem,” – said the manager of the index fund CoinShares Alexander Schmidt.

On average, the sector accounted for 4% to 7% AUM funds.

Slightly more than half of traditional structures surveyed indicated a reluctance to invest in cryptocurrencies over the next three years.

According to the study, hedge funds with open positions in the sector plan to either maintain or increase investments, despite market volatility and regulatory uncertainty.

According to John Garvey, head of financial services at PwC in the US, these factors have limited investments for more than half of the respondents.

23% of traditional hedge funds are rethinking their strategy in the sector due to the unfavorable regulatory environment in the US, 12% of cryptocurrency hedge funds are considering moving outside the country.

As a key opportunity, 31% of traditional structures consider tokenization. A quarter of those who avoid investing in cryptocurrencies are actively exploring this direction.

Recall that in November 2022, LeadBlock Partners, a crypto venture capital firm, raised $150 million in a second fund. Through the first such structure, the firm has backed Yuga Labs, Bitpanda, and BlockFi.

In April 2023, China Pacific Insurance Group from China, through its subsidiary, launched two investment funds in Hong Kong focused on the digital asset industry.

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