According to a report by Financial Times, the hedge funds for cryptocurrency are now below by 35 percent this year. The decline is in complete contrast to that of last year where revenues were up by 2.7 percent in as much as the market’s success totaling to 167 established firms only in 2017.
The prices on the market continued to decline as the digital currency market in 2018 takes on a rough path.
“I expect the crypto markets to remain volatile for the foreseeable future. While retail investors may see volatility in the crypto markets as a downside, many crypto funds see it as an opportunity,” said Henri Arslanian, PWC lead for cryptocurrency.
The top rank for cryptocurrency is now the third of its value in the ATH held last year of mid-December as the downfall of bitcoin prices continue to epitomize on the market situation.
As of April this year, a total of nine firms had already chosen to close down as only 8 percent among the top 25 crypto hedge funds have profits which they recorded. The hedge funds for cryptocurrency have already lost so many in the prolonged situation of 2018.
Even with the continuous decline, hope still remains for the hedge funds through positive signs showed. Other news coming from the SEC on the Bitcoin and Ether regulatory status in the U.S. has been an avenue to a downturn in the dour market. As these two are the top digital currencies being exempted from the SEC regulators jurisdiction, some investors for the institution may still be incentivized to be placed more in the market.
Some of the factors which contributed to the price downfall are the lack of clarity on the regulatory and delay in the critical market apparatus emergence such as custodial tools.
On the aspect of institutional investors, the Coinbase and Goldman Sachs firms have already launched their products which target big-time investors. The revival of the cryptocurrency market can likely start through the emergence of trustworthy custodial tools and other clear regulations. As such, it will garner better opportunities for the cryptocurrency hedge funds once again.