Category Archives: Autonomous NEXT

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Crypto Hedge Funds’ Rapid Growth Proof of Booming Crypto Industry

A study by crypto analytics firm Autonomous Next has found that the number of crypto hedge funds has been rapidly growing since 2016, showing that crypto investment is a booming industry. All together, crypto hedge funds manage USD 7.5 – 10 billion of assets. This represents the start of what could be a massive wave of institutional investment into the crypto space.

Prior to 2014, only 12 crypto hedge funds were formed; to put this in perspective, Bitcoin launched in 2009. By the end of 2014, there were 27 crypto hedge funds. This growth in hedge funds occurred during and after the rally that pushed Bitcoin’s price above USD 1,000 for the first time. In 2015, there were 35 crypto hedge funds, the small amount of growth was probably due to the strong bear market at the time. In 2016, the number of crypto hedge funds jumped 60% to 56.

2017 saw the biggest crypto rally in history, with Bitcoin rising all the way to USD 20,000 and Ethereum rallying to become the second most valuable cryptocurrency. Simultaneously, numerous other cryptocurrencies launched and became very popular. By the end of 2017, there were 251 crypto hedge funds, a 348% increase since 2016.

There is definitely some correlation between a rising crypto market and the rate of formation of new crypto hedge funds, but even during bear markets, additional crypto hedge funds have been forming. During the first half of 2018, which was a strong bear market, the number of crypto hedge funds rose 24% to 312.

Crypto hedge funds are using different strategies, including making money from trading, buying and holding various cryptocurrencies, tracking an index comprised of various cryptocurrencies, hedge funds that track the average of crypto hedge funds, and investing in crypto infrastructure like wallets and exchanges. A tiny fraction of crypto hedge funds is focusing on artificial intelligence and quantum technology.

Apparently, the top hedge funds hold most of the capital, with the top ten crypto hedge funds holding 43% of the total money in crypto hedge funds and the top 50 crypto hedge funds holding 80%.

 

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Blockchain Startups Refusing to Fail in the First Few Years Will Make History

Many CEOs and cryptocurrency experts are suggesting that many startups will fail but those remaining have the potential to be huge successes thanks to the blockchain, writes Business Insider.

References to the dotcom bubble have been made too many times for it to be an original view but pundits from within the industry continue to predict that cryptocurrencies have the potential to change/rewrite the rules of financial markets.

eToro CEO,Yoni Assia’s view that 95% of startups are going to end up badly is shared by many in the industry, suggesting that ‘Selling crypto now is like selling Apple in 2001’ he goes on to suggest that it’s the survivors who will reap the benefits and changed the face of the market, in the same way as the internet transformed people’s lives by becoming a feature of everyone’s lives.

Statistics show that more than 1,000 cryptocurrency startups worldwide have raised over $10 billion over the last two years to build significant market changing software projects. Over $9 billion has been raised through ICOs since the start of the year, according to consultancy Autonomous NEXT.

These views were shared by Ethereum co-founder Joe Lubin recently, suggesting the current situation is similar to the nineties’ dot-com bubble, which ended badly for many companies, but left the survivors thriving. Assia argues:

“If you’re into this technology, you’re like, why hasn’t everybody moved on to this technology? It’s an endless opportunity to move things on to the blockchain. You have an insane amount of very smart people who are envisioning this future and trying to build products for it.”

IOTA creator Dominik Schiener also shares the view suggesting that out of 1400 recent projects he expects less than 10 to make it. With former JPMorgan trader Danny Masters, it could be an even smaller figure: suggesting that no more than 5% percent of ICOs are worth backing.

Many pundits and crypto experts see digital currency’s underlying technology blockchain as the factor that will be the most transformational aspect of the predicted crypto boom, some going as far as to suggest it will “remake society.” A recent Forbes article suggested that in a study of 4,800 professionals from around the world, 66% of people believe that innovation will be the biggest factor influencing economic growth over the next 30 years, and one of the most promising of these developments was blockchain.

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