As a part of the current Bitcoin (BTC), Ethereum (ETH), and wider digital foreign money market bull run, complete property underneath administration (AUM) of crypto hedge funds elevated from a bit of over $2 billion in 2019, to over $3.8 billion final yr, according to Massive 4 auditing agency PricewaterhouseCoopers’ (PwC) third Annual World Crypto Hedge Fund Report 2021.
PwC’s report, which covers the outcomes of survey-based analysis carried out throughout Q1 2021 by Elwood Asset Administration, whereas combining qualitative inputs from PwC’s crypto division, reveals that there was a median efficiency of 184% final yr (significantly better than 2019 at 17%).
Digital currencies have had an unprecedented yr with their mixed market cap growing 132% because the begin of 2021. The digital asset market bull run, which began round September 2020, drove the BTC value to an all-time excessive of greater than $64,800 (however the main crypto and the remainder of the market have now gone by a significant correction).
In April 2021, nonetheless, the mixed market cap of the crypto market surpassed the $2 trillion mark for the primary time ever. Altcoins or digital currencies aside from BTC have been liable for main many of the rally.
Whereas fastidiously analyzing the most recent digital asset hedge funds information, the impact of the 2020-2021 crypto bull market is kind of obvious, the PwC report reveals, including that the share or proportion of funds managing bigger quantities of property was considerably better throughout 2020, when in comparison with 2019.
Final yr, the share of crypto-asset hedge funds with AUM of greater than $20 million surged from 35% in 2019 to simply over 45%. In the meantime, the variety of funds with comparatively smaller AUMs fell from over 80% in 2019 to round 55% final yr.
The common AUM for 2021’s surveyed funds surged from $12.8 million in 2019 to roughly $42.8 million in 2020, in the meantime, the median AUM surged from $3.8 million to $15.0 million.
PwC’s survey outcomes recommend that there’s been regular adoption of decentralized finance (DeFi) protocols by crypto-asset hedge funds with simply over 30% of surveyed corporations now utilizing decentralized or non-custodial exchanges (DEXs). Uniswap was essentially the most broadly used DEX (15.7%), adopted by 1inch (7.9%) and SushiSwap (4.5%)
Digital asset hedge funds have been additionally requested about how they anticipate the crypto market to carry out sooner or later.
Outcomes from the survey point out that asset managers are nonetheless fairly bullish, with most of them (65%) predicting or forecasting that the BTC value shall be someplace within the $50,000 to $100,000 vary. Round 21% assume that the Bitcoin value shall be anyplace between $100,000 and $150,000 by the tip of the yr.