Bitcoin favorite of financial monsters despite market crash

An increasingly popular Bitcoin, but… – The return in 2021 of the hedge funds focused on cryptocurrencies had surpassed that of traditional funds. Given these results, are you now betting on the assets of the new finances?

Hedge funds and cryptocurrencies: an (always) cautious opening

PricewaterhouseCoopers (PwC) published a report on theadoption cryptocurrencies by traditional hedge funds. The document contains key figures on the subject. These data come in particular from a survey conducted in the first quarter of 2022, with 89 hedge funds.

Y 3 stats provide an overview of the current and future level of commitment of these funds in cryptocurrencies:

  • About a third of study participants invest in digital assets;
  • 57% of funds already committed to cryptocurrencies have allocated at least 1% of their assets under management to the sector;
  • While 2 thirds of these funds plan to increase their investments in the industry, by the end of 2022.

What do these figures reveal? These data attest, on the one hand, to a gradual adoption cryptocurrencies by hedge funds. But they also show, on the other hand, a limited exposure of the latter to this new asset class.

How do these funds explain their cautious approach against cryptocurrencies? Those who responded to the survey mentioned “regulatory and fiscal uncertainty” as a major obstacle to investment in the sector.

Specifically, hedge funds fear 2 points related to regulations:

  • Differences in the regulatory framework on cryptocurrencies at a global level;
  • Lack of clarity on guidelines regarding the management of this asset class.

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Bearish Crypto Markets: Are Funds Still Bullish on Bitcoin and Its Cadets?

A better understanding of the context allows for a richer interpretation of the above data. the bearish crypto markets give a particular color to this study. In fact, the Bitcoin (BTC) and their juniors experience a bear market in 2022. The 2021 bull run has ushered in this year’s crypto winter.

the drop of the price of Bitcoin It illustrates quite well the scope of the declines in the markets. However, the price of the cryptocurrency had reached a all-time high around $69,000 in November 2021. Subsequently, he failed to reconnect with $50,000 in 2022. He will even return under the bar $30,000 this year.

What does this knowledge of the context contribute to the analysis of the figures published by PwC? According to these data, these funds that already invest in cryptocurrencies want increase your exposuredespite these market shocks.

This prospect is obviously encouraging for the cryptosphere. But this statistics reveal for the moment only one intention. The decisions that shape reality can, in fact, change as the situation changes.

Another question can serve as a conclusion to this article. A strong bullish rally in crypto markets Will it be mechanically accompanied by an increase in cryptocurrency investments by these funds?

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