A $1 Billion Crypto Investment Vehicle In Works ‘For Institutional Investors’
UK asset management firm Elwood plans to develop a giant $1 billion bitcoin and cryptocurrency investment venture, it says.
Elwood Expands Cryptocurrency Exposure
Quoted by the Financial Times on August 30, Elwood, which is owned by billionaire Alan Howard, revealed it wants to funnel cash into crypto hedge funds.
The company is no stranger to the crypto investment space, having launched a Blockchain exchange-traded fund (ETF) in March.
According to the Times, Elwood “is working on a platform that would design portfolios of crypto funds for institutional investors.”
Commenting to the publication, CEO Bin Ren said that while caution was still needed in the industry, the possibilities for growth were considerable.
“Losing traditional assets in the real world is hard. In the digital world, it’s very easy to lose assets — put in the wrong address for a bitcoin transfer and it’s gone forever,” he warned.
Nonetheless, staff have already begun sniffing out appropriate hedge funds, with 50 under the microscope for due diligence compliance.
“I see this as a very big growth opportunity,” Ren added.
Rebirth Of The Crypto Hedge Fund
The move underscores the renewed faith in crypto hedge funds in 2019. After a troublesome year during the Bitcoin bear market, which saw many funds fold, fortunes have returned.
“Bitcoin is here to stay. Long term it will be part of a lot of hedge fund portfolios,” Don Steinbrugge, CEO of Agecroft Partners told CNBC earlier this month.
The trend forms just part of a wider phenomenon among investors seeking exposure to the Bitcoin market in particular. This year will see a range of new instruments hit the market, starting with Bakkt’s physical futures trading in September.
As Bitcoinist reported, after multiple delays, the company will finally begin accepting client BTC deposits next Friday.
“These contracts will enable physical delivery of bitcoin with end-to-end regulated markets and custody,” a statement from the company on social media read.
Future institutional involvement has meanwhile yet to make a dent in Bitcoin markets. As of August 30, BTC/USD still languished below $10,000, having slid almost 10% this week.
Settlement of CME Group’s Bitcoin futures occurs today, something which has traditionally exerted pressure on price. Leveraged traders also felt the pinch this week, with BitMEX liquidating long positions worth $150 million on Thursday alone as Bitcoin fell.
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