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Crypto hedge funds expect strong price performance in 2023

Crypto-bank in het nauw: Silvergate kampt met bankrun van $8,1 miljard

From one new research from Price Waterhouse Coopers (PwC) shows that the majority of crypto hedge funds are convinced that prices will end better this year than 2022. Bitcoin has already been on a convincing upward trend since the end of 2022, which has caused the price of the digital coin to increase by 85 percent. rise in 2023.

The industry’s total market cap increased from $828 billion to $1.25 trillion over the same period. Bitcoin currently accounts for half of that value.

Bullish on crypto

“Despite the volatility in the market and the collapse of some well-known players in the industry, crypto is expected to continue to perform strongly in 2023,” writes John Garvey in the report from PwC US.

In the study, we do find that the percentage of traditional hedge funds investing in crypto has fallen from 37 to 29 percent in 2023. PwC attributes this mainly to the problems in the field of legislation and regulations in the United States.

The funds that already invested in crypto, on the other hand, seem to have the intention to maintain or even expand their investments, despite the difficulties that the market is currently having to overcome.

The report is based on two separate surveys; one in which 131 crypto funds participated and another in which 59 traditional hedge funds were surveyed.

Traditional opts for tokenization

What is striking is that traditional hedge funds are less interested in traditional cryptocurrencies and are focusing more on tokenization. About 25 percent of traditional hedge funds say they are exploring opportunities to tokenize traditional assets.

Where traditional funds still invested in non-fungible tokens (NFTs) last year, this is not the case this year. In that respect, it seems that this hype is over, at least within the traditional financial world.

All in all, we can say that this special group of investors is still interested in crypto. That interest will only have increased with BlackRock’s Spot Bitcoin ETF filing a few weeks ago.

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