Traditional hedge money is gradually embracing cryptocurrency investments but they are keeping their exposure limited because the market is constantly on the mature, based on new information from PricewaterhouseCoopers, or PwC.
In the fourth Annual Global Crypto Hedge Fund Report 2022, PwC stated roughly one-third of traditional hedge funds surveyed happen to be purchasing digital assets for example Bitcoin (BTC). So-known as “multi-strategy” hedge funds were probably to take a position, adopted by macro strategy and equity strategy firms, correspondingly.
From the hedge funds presently committed to the crypto space, 57% have allotted under 1% of the total assets under management. Two-thirds from the firms presently invested intend to improve their exposure through the finish of 2022.
Respondents reported “regulatory and tax uncertainty” because the single finest barrier to investing. Particularly, hedge money is worried about a fragmented regulatory atmosphere globally in addition to unclear assistance with the way the asset class is going to be governed.
As many as 89 hedge funds were incorporated within the survey, that was conducted throughout the first quarter of 2022.
Hedge funds along with other traditional asset managers happen to be eyeing developments within the crypto sector to gauge whether or not they must start purchasing the area. While several hedge funds have launched crypto divisions and began purchasing the area, nearly all firms stick to the sidelines. Interestingly, a 2021 survey of 100 global hedge funds says managers be prepared to allocate an average of 10.6% to crypto within 5 years.
Related: What’s driving institutions to purchase crypto? BlockFi’s David Olsson explains
Although crypto assets will be in a protracted bear marketplace for a lot of 2022, institutional investors seem to be buying the newest cost dip. Inflows into Bitcoin investment products, for example exchange-traded funds and Grayscale’s GBTC product, elevated by $126 million a week ago, based on CoinShares. Bitcoin investment funds have silently added over $500 million in internet inflows this season.
