Hedge Fund Research (HFR) is a firm that tracks institutional investments in blockchain tech and cryptocurrencies. And the company’s two crypto-tailored indices are showing titanic returns for the hedge funds that have taken a chance on the space so far.
HFR’s two indices are the HFR Blockchain Composite Index and the HFR Cryptocurrency Index — world firsts as far as tracking hedge funds’s performances in the cryptocurrency ecosystem.
Per Kenneth Heins, HFR president:
“Investor interest in funds offering exposure to blockchain technologies and cryptocurrencies has surged in recent months.”
But you don’t have to take Heins’ word for it because the numbers speak for themselves. The company’s Blockchain Composite Index has its tracked hedge funds up a whopping 1,520 percent from January to November 2017 — not even a full year.
Similarly, the HFR Cryptocurrency Index has its tracked funds up by more than 1,640 percent during the same timeframe.
The CIO of a crypto hedge fund explains the value in cryptocurrency pic.twitter.com/2MOJ298JA8
— Business Insider (@businessinsider) December 3, 2017
And, if recent maneuverings in the marketplace are any indication, the ongoing surge is only just beginning. That’s because Bloomberg is now reporting the $14 billion USD firm ED&F Man Capital Markets just “signed agreements with 35 hedge funds, family offices, and proprietary-trading firms to help them buy and sell bitcoin futures and is in talks with at least a half dozen more.”
That’s a lot of money that’s going to start pouring in from the periphery of the crypto space. Which inevitably means some of that influx of money is going to flood in from the periphery to the center, i.e. hedge funds directly buying cryptocurrencies and not just crypto futures and ETFs.
Indeed, with Coinbase launching Coinbase Custody specifically for institutional funds, it seems it’s only a matter of time before Wall Street helps cryptocurrencies go mainstream.
TLDR: Hedge funds are experiencing FOMO (“fear on missing out”), as they are clamoring into the crypto ecosystem in unprecedented numbers. The herd’s coming.