- The hedge funds through Bitcoin as their primary asset were the most profitable for the year 2019.
- The Deutsche Bank in Germany stated that cryptocurrency seems to be more attractive than traditional assets in 2020.
A study conducted by Eurekahedge revealed that the hedge funds through Bitcoin as their primary asset were the most profitable for the year 2019.
The profitability of hedge funds with cryptocurrency was around 16% on average, whereas traditional hedge funds only received a profit of 10%. The difference might not look much at first, but it is enough for investors to consider Bitcoin a favorable option.
The Deutsche Bank in Germany stated that cryptocurrency seems to be more attractive than traditional assets in 2020. It also suggested that more people would prefer cryptocurrency due to its “advanced technology.”
One needs to understand that buying and selling Bitcoin is a lot simpler as compared to other assets. This feature of Bitcoins makes it easier for hedge fund managers to respond quickly to market demands.
2019 was an excellent year for Bitcoin as it saw a 200% rise in value. The main reason behind this rise was the trade war between the US and China. The devaluation of the renminbi, along with the announcement of Libra, made it even better for Bitcoin.
If you look at the year 2018, Bitcoin saw a drop of 85% in its value when compared to the maximum of $20,000, and it achieved in December 2017. The reason behind Bitcoins’ fall was the money lost in start-ups that were scamming people.
However, taking a look at the recent hedge fund earnings, one realizes that the cryptocurrency has become more reliable, and people are no longer afraid of investing in Bitcoin.
Steve Kurtz from the Galaxy Digital cryptocurrency fund said that the investors interested in Bitcoin is “getting bigger” as the profitability of Bitcoins in a duration of 2-years or 10+ years is looking impressive.
B2C2 founder Max Boonen also gave a similar conclusion. He said that it’s only a matter of time that Bitcoin becomes a member of traditional assets when it comes to hedge funds.