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It's no secret that many cryptographic investors are pinning their hopes on institutional and corporate investments as the next catalyst that will bring markets back to their historic peaks, or even beyond.
Despite this, the stock market crash of 2018 and the ensuing bear market tempered the speed at which these groups entered the emerging markets, but now that markets appear to be on the rise, larger investments may begin to flow.
Will cryptographic funds continue to gain popularity?
A recently published research report conducted and composed by CryptoFundResearch elucidates an interesting, but not surprising, trend in the cryptography markets, with cryptocurrency hedge funds being among the best performing funds in the world in 2017, placing them on the radar of large investment groups who have been impressed by the mbadive gains of some of these funds.
"Cryptographic hedge funds are the fastest growing segment of the hedge fund industry. In addition, many of the top performing hedge funds in 2017 were cryptocurrency funds, "the report says.
This surge in popularity has resulted in an influx of new funds, with more than 200 hedge funds launched in 2018. Despite this, the report also explains that this booming trend of new cryptographic funds appearing left and right risks not to last Increasing competition in the sector will make it increasingly difficult to secure significant funding.
"We expect that the number of funds launched in 2019 will decrease from the fast pace recorded in 2017 and 2018," said CryptoFundResearch, estimating that only 145 funds will be launched in 2019, against 224 in 2017 and 239 in 2018..
Despite fierce competition, large investment funds attract large investments
Although the cryptography industry is diluted with a significant number of hedge funds and investment funds, it is highly likely that the smaller ones will start to disappear, as savvy investors place their capital only in more profitable and more compliant with the regulations.
Barry Silbert, Founder and CEO of Digital Currency Group, the parent company of Grayscale Investments, which offers a multitude of single-badet and diversified investment products, explained in a recent tweet that the Grayscale family of funds has committed significant funds last week alone.
"GREAT Week for @GrayscaleInvest -> we have raised more than $ 20 million in the Grayscale family of funds, our highest week since 2017," he said in a recent tweet.
GREAT week for @GrayscaleInvest -> we have raised more than $ 20 million in the Grayscale family of funds, our highest week since 2017
– Barry Silbert (@barrysilbert) April 26, 2019
The influx of funds into the Grayscale family of funds may be emblematic of improved market fundamentals, with many badysts beginning to believe that the cryptography market's 2018 troughs are actually a long term.
Selected image of Shutterstock.
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