A survey conducted by Crypto Fund Research revealed that cryptocurrency investment funds grew at a better than expected rate during 2018, hinting that the greater investment community is beginning to give legitimacy to the digital currency as an investment vehicle.
The study showed that there were 466 cryptocurrency investment funds in the US, the majority (255) are marketed as hedge funds. Of those 255, 195 are venture capital funds and 16 represent private equity funds.
According to the present rate of growth of these funds the study predicts that there will be 165 new cryptocurrency funds by the end of 2018, beating the 2017 figure of 156, a record.
Most funds of this variety have only $10 million or less in holdings. There are only 28 funds with over $100 million. This group of better endowed funds include: Arrington XRP, Novogratz’s Galaxy Digital Assets, Polychain Capital, and more. Together the funds control about $7.1 billion in assets.
Founder of Crypto Fund Research, Josh Gnaizda, says the large growth is unexpected considering the downturn of cryptocurrency prices:
“We expected a large number of new crypto funds to launch in 2018 to satisfy growing investor demand. However, the pace of new fund launches is a bit surprising given the dual headwinds of depressed prices and less than favorable regulatory conditions in many regions,” said Gnaizda.