Сrypto Funds List

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What Are Crypto Funds?

The hype around digital currencies became a key factor in the emergence of the first crypto fund list. Back then, investments in cryptocurrencies looked very attractive due to low returns on traditional assets. This was facilitated by the emerging market, relatively weak competition, many inexperienced novice investors and the opportunity to earn hundreds and thousands of percent per annum.

Cryptocurrency funds are investment funds that are either investing entirely in cryptocurrencies or combining it with investments in other assets. Their task is to get the maximum return by managing the coins of their contributors or investing their funds in crypto projects and initial coin offerings (ICOs).

Small crypto funds focused on retail investors are suitable for those who want to earn income, but are not ready to invest in the crypto market on their own. In such funds, specially trained managers and managers are engaged in asset selection and trading. The investor does not need to monitor the news and crypto hedge fund lists, choose coins, worry about the exchange rate and portfolio balance – all this will be done for him by professionals. 

Top cryptocurrency funds are the necessary intermediaries for institutional investors to enter the crypto market. Indeed, due to legislative restrictions, especially large capital owners in many countries cannot buy digital assets directly.

Crypto funds list includes several categories – there are many classifications of crypto funds. We will focus on two main ones.

According to the access of investors, cryptocurrency funds are divided into:

Private – only qualified investors can buy their shares. These are the largest funds on the market, accumulating tens of billions of dollars.

Open – available to retail investors. Such funds are unregulated, when the investor simply buys the fund's shares, and regulated, or exchange-traded (ETF), when the fund's shares can be traded on the stock exchange.

According to the type of investments, crypto funds list can include:

Venture funds – when the fund invests money in blockchain and crypto companies. These are funds for large capital: an ordinary investor cannot join them.

Hedge funds – they allow users to earn profit from investments in digital assets.

Crypto Hedge Fund List

Let's take a closer look at ETFs and hedge funds.

ETF (Exchange-Traded Funds) is a crypto fund whose shares are traded on the exchange, they can be purchased by anyone. The fund itself buys crypto assets and then sells a portfolio share in the form of a security. This allows investors to invest in cryptocurrencies without buying them directly. To do this, they just need to open a brokerage account. 

It is believed that growth of the ETF will dramatically increase the number of investors in digital assets. After all, even those who trust traditional investment instruments more could invest in them, since ETFs are regulated by securities laws, and the fund is responsible for the safety of coins.

Unfortunately, due to regulatory complexities, there are only a few officially approved ETFs in the world right now.

Hedge funds also make money on rising prices of crypto assets, but their shares are not traded on the exchange. Most often, the shares of regulated funds are available only to qualified investors, and the entry threshold itself starts from several hundred thousand dollars. Unlike ETF projects, hedge funds startups are much less regulated. They can invest in almost any risky assets, including cryptocurrencies based on different blockchains. 

At the same time, there are also unregulated hedge funds on the market that sell shares in their portfolios in the form of shares to any network user. The entry threshold to them starts from $10–$20. But investing in such ventures is a dubious idea. It is easier, more profitable and safer to just buy cryptocurrencies directly.

Traditional hedge funds tend to have active trading strategies in which they buy and sell cryptocurrencies in short periods of time in order to profit from price fluctuations. However, most of the funds are now in passively managed crypto funds – these firms have simply bought coins and are waiting for them to grow in value.

Cryptocurrency funds charge a commission for asset management: on average, from 5% to 20%. At the same time, money, as a rule, cannot be withdrawn before the investment period.

It is noteworthy that most of the crypto funds consistently outperform Bitcoin in terms of profitability.

Crypto Fund Research: How Does This Sector Develop? 

The financial world has been slowly recognizing cryptocurrencies as a viable type of investment. Until 2017, they were not very popular – only a few dozen crypto funds entered the crypto market by that time. This was hindered by too many questions and disputes: how to regulate the cryptosphere, how long the growth will last, how to deal with the high volatility of digital currencies, and how to identify fraudulent projects.

But 2017 was the year of cryptocurrencies among retail investors. Millions of people around the world began to buy cryptocurrencies, but inexperienced beginners needed the help of professionals, with their crypto fund research skills. The first institutional investors began to appear.

Despite the slowdown in the launch of new funds, the volume of investments in them increased several times. The growth potential of the sector is huge. Accurate portfolio data for VCs and hedge funds is difficult to obtain: most of them do not disclose this marketing information, and the rest provide it only to accredited investors.

At this stage, large cryptocurrency funds are the most important part of the infrastructure of the crypto market. They act as intermediaries between the crypto sector and institutional investors, whose entry into the market has been one of the key factors in the maturation of the industry. The more funds and the larger they are, the more mature the entire cryptosphere becomes.