Crypto Hedge Funds' Asset Under Management Doubled Last Year: Report

Michael LaVere
  • Crypto investment firm Grayscale has reached an all-time high of $3.7 billion in assets under management (AUM).
  • The firm's bitcoin trust product accounts for 89 percent of total assets. 

The total assets under management (AUM) of cryptocurrency hedge funds has doubled to $2 billion in 2019, according to a report by PwC and Elwood Asset Management. The report details that the total AUM of crypto hedge funds moved from $1 billion in 2018 to $2 billion in 2019, as the price of BTC kept on growing.

It adds that the percentage of cryptocurrency hedge funds with AUM of over $20 million increased from 19% to 35% in 2019, with the average AUM increasing to $44 million up from $21.9 million.

PwC and Elwood classified cryptocurrency hedge funds according to several broad strategies, covering funds that tend to have longer lock-in periods for investors, funds that follow hybrid strategies, and funds that trade in more liquid cryptocurrencies, as well as funds employing a combination of these strategies.

Funds trading in more liquid cryptocurrencies, so-called quantitative funds, wre found to be the most prevalent in the market. Most crypto hedge funds traded bitcoin (97%) and ether (67%). Only little over one-third (38%) trade XRP and LTC.

Digital asset investment firm Grayscale, meanwhile reached an all-time high of $3.7 billion in assets under management (AUM). According to a tweet by Grayscale on May 8, the digital currency investment firm has hit an all-time high of $3.7 billion in assets under management. Barry Silbert, founder of Graysacle and CEO of the crypto venture capital firm Digital Currency Group, retweeted the statistic to his 200,000+ followers. 

According to the update, Grayscale’s bitcoin trust is by far the firm’s most popular product. The trust holds $3.31 billion in bitcoin, accounting for roughly 89 percent of the firm’s total AUM. Grayscale’s ethereum trust holds an additional $279 million in ETH, while the ethereum classic trust accounts for the third-highest percentage of AUM at $76 million. 

Grayscale, founded in 2013, has become one of the world’s leading institutional investment firms in digital currency. 

The firm also published a recent video explaining bitcoin’s block reward reduction, set to occur on May 11, to investors who may be new to cryptocurrency. 

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