{"id":57211,"date":"2018-06-01T17:33:53","date_gmt":"2018-06-02T00:33:53","guid":{"rendered":"https:\/\/cryptoslate.com\/?p=57211"},"modified":"2018-10-07T04:03:45","modified_gmt":"2018-10-07T11:03:45","slug":"crypto-funds-explode-in-2018-as-venture-capital-attacks-the-ico-model","status":"publish","type":"post","link":"https:\/\/cryptoslate.com\/crypto-funds-explode-in-2018-as-venture-capital-attacks-the-ico-model\/","title":{"rendered":"Crypto Funds Explode in 2018 as Venture Capital Attacks the ICO Model"},"content":{"rendered":"

Blockchain technology and cryptocurrencies have become a prime target for forward-leaning hedge funds, venture capitalists, and private equity firms in 2018 as the crypto ecosystem rapidly matures. The total number of cryptocurrency funds has skyrocketed over the first half of 2018, surging to over 225<\/a> from just 58 at the end of 2017.<\/p>\n

While crypto funds may have experienced a rocky start to the year, with nine funds shutting down amidst a 48% nosedive in net returns across all cryptocurrency programs in the Barclays database<\/a>, crypto funds have experienced a strong rebound with a 48% positive shift in April onwards.<\/p>\n

Crypto Funds Set to Multiply in 2018<\/h2>\n

The rapidly evolving cryptocurrency market is gradually merging with the existing global financial system, with more complex financial instruments and products becoming available to market professionals.<\/p>\n

\"First
Related Story:\u00a0First Regulated Ethereum Futures Launched In UK: How Will Futures Contracts Impact ETH Price?<\/a><\/figcaption><\/figure>\n

The first Bitcoin futures<\/a>, launched in December 2017, catalyzed a surge of interest from traditional market participants, which has multiplied with the recent availability of Ethereum futures<\/a>.<\/p>\n

The amount of tools available to market professionals within the crypto market, however, is still limited, leading to the creation of funds that unite the capital of both market newcomers and professionals.<\/p>\n

\"Crypto
Source: @ritvikcarvalho<\/a><\/figcaption><\/figure>\n

The highly volatile and lucrative nature of the crypto market led to the development of adaptive financial institutions that focus on the cryptocurrency market, such as crypto-specific funds.<\/p>\n

Data published<\/a> by the Wall Street Journal demonstrates that average yields across 24 samples of crypto funds exceed 3,000%.<\/h3>\n

Compared to the 8% return<\/a> offered by traditional hedge funds, it\u2019s easy to see why so many new funds are in the works.<\/p>\n

Where are Crypto Funds Investing?<\/h2>\n

Data<\/a> shared by fintech analysis firm Autonomous NEXT with CNBC demonstrates that crypto funds currently manage more than $5 billion in assets, contributing significantly to the entire blockchain ecosystem.<\/p>\n

Hedge funds account for roughly 65% of all cryptocurrency funds, with a further 32% driven by venture capital. Private equity firms hold just 3% of the total assets managed by crypto funds.<\/p>\n

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RT @cryptomanran<\/a>: This is a great graphic to show which projects funds are invested in. pic.twitter.com\/14wRNUjfGN<\/a><\/p>\n

— \u212d?????????? ??????? (@Stocktrader) May 28, 2018<\/a><\/p><\/blockquote>\n