We know that delving into the world of financial jargon can be fairly indecipherable and dull, but it is important for the savvy crypto investor. Consider hedge funds: What are they? They’re a financial vehicle where investors pool their money together to be invested collectively by a fund manager.
Does this sound quite similar to a unit trust or mutual fund? Well, it is. However, hedge funds are usually significantly more aggressive and look to generate investors higher returns.
For our purposes, we want to talk about crypto hedge funds that invest in cryptocurrency projects. Think of it as handing your cash to a fund manager to invest in crypto on your behalf. A hedge fund might invest in Bitcoin, Ripple, Litecoin, and Ethereum or it might buy a bulk of altcoins during a pre-ICO sale. It all depends on where the fund manager thinks the best gains are to be had.
Crypto hedge funds are ideal for hands-off crypto investors who don’t have the time or know-how to buy and store crypto. Using a fund means that investors leave all the cryptocurrency stuff to the fund manager. This way you can get exposure to crypto as an asset class without actually having to buy coins and execute trades yourself. Most hedge funds are managed by people who are often considered to be experts in the market. These managers perform an in-depth analysis of where best to direct their client’s funds and get the best returns.
Here is a list of ten of the top crypto hedge funds to consider if you’re in the process of trying to decide where to invest.
First up is Pantera capital, which is a crypto hedge fund that has secured funding from powerful investors like Fortress Investment Group, Ribbit Capital, and Benchmark Capital. Based on its portfolio list, Pantera invests in a variety of assets such as Bitcoin, Ox, and Omise, along with BitOasis and BitPesa. Additionally, Pantera invests in cryptocurrency exchanges like Poloniex, Bitstamp, and Kraken.
Pantera was established in 2013 by former CFO of Macro Trading, Dan Morehead. Over its lifetime, the hedge fund has generated over 25,000 percent returns. To date, Pantera manages over $700 million in client funds across its five crypto funds. The firm is open to accredited investors looking to invest in blockchain and cryptocurrency enabled companies.
BitSpread is a market-making fund which looks to profit from investments and hedge funds in cryptocurrencies like Litecoin, Ripple, and Bitcoin. The firm oversees more than $100 million in client funds and makes its money based on market-making activities. Bitspread performs over 5,000 transactions each day and trades roughly $1 billion in cryptocurrencies on a monthly basis.
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Founded in 2014 by Cedric Jeanson, former COO at Nomura Holdings. BitSpread sees most of its returns in hedge funds built around trading Bitcoin, Bitcoin Cash, and Ethereum. It’s clear that Jeanson believes in the future of Cryptocurrencies, which makes BitSpread a hedge fun worth considering.
Silver 8 Capital
Focusing on blockchain and financial technologies, Silver 8 Capital are a firm that allocates its investments toward digital assets. Additionally, the company makes significant investments in early-stage companies focusing on blockchain technologies. Silver 8 Partners currently manages more than $300 million in digital assets.
Founded in July of 2015 by Manuel Anguita and Jose Suarez, Silver 8 Capital invests directly into cryptocurrency, as well as infrastructure plays. Anguita and Suarez share well over 50 years of investing experience between them. This experience is why so many see Silver 8 Partners as one of the most solid funds around.
Launched in September of 2013 by Barry Silbert, Grayscale is a digital currency based hedge fund with roughly $1.6 billion in assets. This makes it one of, if not the largest hedge fund in the cryptocurrency space. Grayscale offers hedge funds specializing in both Zcash and Ethereum Classic.
Rooted deeply into cryptocurrency investing, it’s clear that Barry Silbert believes in the future of digital assets. It shows by the varying investment trusts which his fund offers. Investors can choose between Litecoin, Bitcoin, Bitcoin Cash, Ethereum, and Ripple investment trusts, or select a more diverse Large Cap fund.
Blackmoon is a platform which offers investment opportunities in both crypto and traditional assets. The firm is unique in that its crypto platform provides a one-stop shop for other hedge fund managers to create their own compliant, tokenized funds. In essence, it’s a platform built by hedge fund managers, for hedge fund managers. A key feature of Blackmoon’s service is that they also guide managers through corporate structuring and legal considerations. The end result is that investors in Blackmoon tokenized funds can do so with minimum regulatory risk. This is obviously a massive deal if you are a high net worth individual planning to invest a couple of million into crypto markets.
The firm was founded in 2014 by Oleg Seydak, previous co-founder of Flint Capital, and Ilya Perekopsky, former VP and CCO of VK.com. With experience in cryptocurrencies, digital assets, and financial technologies, it’s easy to see why Blackmoon is one of the top ten crytpo hedge funds.
CoinCapital is a crypto hedge fund that focuses primarily on investing in cryptocurrencies and blockchain technology start-ups. This company invests in and researches digital currencies to give their investors the best return for their money. CoinCapital believes in blockchain technologies and wants to help facilitate a transition to a decentralized system.
Established by Jeff Nabers and Ryan Ballman, the pair brings a wealth of information and experience with them to CoinCapital. In their previous venture, Solo401k.com, both men looked to decentralize retirement assets. This same vision is being applied to the CoinCapital’s cryptocurrency hedge fund. The company provides investment opportunities to blockchain startups, institutions, and individual investors.
Started in 2016 and based in San Francisco, Bitbull is a cryptocurrency hedge fund that invests in crypto assets and startups. With Bitbull, investors don’t have to perform the tedious task of searching for the right investment opportunities. Instead, Bitbull does the work and creates a fund of funds for you.
Investing in Bitbull means investing in multiple currencies and technologies. Led by Joe DiPasquale, the firm offers venture capital and early-stage investment styles to its investors. Bitbull has a zero percent fee and it accepts investments from all qualified investors. Currently, the minimum investment stands at $100,000 USD.
General Crypto is a crypto hedge fund that manages more than $25 million in assets. The firm takes a venture capital approach to investing and currently invests with coins that offer solutions to real-world problems. For instance, General Crypto is invested in Golem due to its decentralized computing capabilities and Ripple and its international wire transfer technology. The cryptocurrency Factom also makes up a significant holding for the fund due to it providing innovative real estate solutions.
One of the primary benefits of the General Crypto fund is its liquidity. The firm believes in investing in assets that can be easily liquidated and passing that liquidity on to its investors. This means that clients should not be stuck in positions due to thin order books. General Crypto was co-founded by Logan Kulgar and Zach Hamilton. So what makes these gents so special? Well, Logan is a serial entrepreneur who has seen great success in the past and Zach is an avid crypto trader and VC. With this dream team at the helm, it’s easy to see why General Crypto is one of the top ten crypto hedge funds in the sector.
Brian Kelly Capital Management
Launched in July of 2017, Brian Kelly Capital Management, or BKCM, was started with Brian Kelly’s own money. Now, when it comes to finance guys, it’s usually a very good sign when fund managers put their own money on the line. Shouldn’t they have confidence in their own abilities after all? Currently, the fund manages over $50 million in assets, and provides its investors with a three-pronged approach: buy-and-hold with 50%, ICOs for 20%, and actively manage the remaining 30%.
Investments in the BKCM consists primarily of cryptocurrencies like Bitcoin, Ethereum, Litecoin, Ripple, Zcash, and Stellar. Additionally, the fund invests in more risky tokens like Golem, Siacoin, and Augur. Based on the success of Brian Kelly, and his willingness to use his own money to start the firm, BKCM is a crypto hedge fund worth keeping an eye on.
Superbloom crypto hedge fund is a simplified investment platform for digital currencies. The firm believes in diversifying portfolios and aligning incentives with their investors. Superbloom waives fees for clients and provides new tokens each year valued at between 10-20% of their current seed holdings.
The first includes both a $10 million hedge fund along with a venture fund as well. Superbloom wants to be the standard for reputable cryptocurrency firms and aims to create a network that reflects its core beliefs. Co-founder Emmie Change, formerly of Y-Combinator, wants to provide a strategy that will increase the profitability and efficiency of the fund.
There is no shortage of options if you’re looking for a crypto hedge fund in which to invest. We’ve just covered ten of them here, but there are many, many more out there and more are launching every day. If you’re serious about investing in cryptocurrency and blockchain technologies and are not sure on the ins and outs of buying crypto, then these funds could be a great place to start. They are by experienced investors who are familiar with both digital currency and the fin-tech sectors. As you might suspect, their sole goal is to generate investors the highest returns possible.