Hedge Funds’ Long-Term Crypto Interest Remains Robust Even as Proportion Investing Drops: PwC

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The proportion of traditional hedge funds investing in crypto assets declined in the past 12 months though the long-term outlook remains positive, according to a new report by Big Four accounting firm PricewaterhouseCoopers (PwC).

The percentage of funds with crypto exposure fell to 29% from 37% in 2022, according to the Global Crypto Hedge Fund Report. No traditional hedge funds plan to decrease their exposure this year, it said.

More than a third (37%) of funds without crypto exposure said they are curious, but are waiting for the asset class to mature further. Thatโ€™s up from the 30% reported a year ago. More than half, 54%, said they are unlikely to invest in the next three years, compared with 41% in the previous report.

Overall, the report speaks to a mixed sentiment toward crypto from traditional financial institutions, with โ€œregulatory uncertaintyโ€ the watch words, as is often the case. PwC found that almost a quarter of hedge funds are reassessing their strategies due to the regulatory environment in the U.S., with 12% considering relocating from the U.S. to more crypto-friendly jurisdictions.

โ€œDespite market volatility, a fall in digital asset prices and the collapse of a number of crypto businesses, investment in crypto-assets is expected to remain strong in 2023,โ€ Jon Garvey, PwC United Statesโ€™ global financial services leader, said. โ€œTraditional hedge funds, committed to the market in the longer term, are not only increasing their crypto-assets under management, but also maintaining โ€“ if not increasing โ€“ the amount of capital deployed in the ecosystem.โ€

Edited by Sheldon Reback.

https://www.coindesk.com/business/2023/07/13/hedge-funds-long-term-crypto-interest-remains-robust-even-as-proportion-investing-drops-pwc/?utm_medium=referral&utm_source=rss&utm_campaign=headlines



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