Bitfinex announces the listing of a $280 million crypto hedge fund

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Written on Mar 16, 2020

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Bitfinex announced the listing of the Bahamas-based hedge fund, Fulgur Alpha.
The hedge fund is fully compliant with the local regulations, and its goal is to increase its assets by the end of the year.
Hedge funds have seen a sharp growth in popularity in the past years, and January 2020 was the best January in their history, although they are likely to see drops due to the coronavirus outbreak fears.

Bitfinex, one of the largest cryptocurrency exchanges in the industry has just announced listing a $280 million-large crypto hedge fund. The hedge fund in question is known as Fulgur Alpha, and it is based in the Bahamas.

According to the exchange’s announcement, the fund is only available for professional investors, and its goal is to increase its assets under Bitfinex’s management in 2020. The fund’s assets are held by Delchain Limited, a licensed crypto custodian.

The fund is also in full compliance with the regulations, as ensured by Deltec Fund Services — an administrator that is also based in the Bahamas — and Deltec International Group’s financial services division.

Bruno Macchialli, who acts as Delchain’s executive head of the operation, explained that the fund is set up in a traditional way. As such, it features risk diversification, and it is a blueprint for institutional investment in cryptocurrencies.

Crypto hedge funds on the rise

The move comes as part of a revolution of sorts, which seems to be particularly favored hedge funds. Recent reports have suggested that January 2020 was the best first month for crypto hedge funds in their existence. In January, crypto hedge funds saw a 21.15% return, which has never happened before in their relatively short existence.

The situation changed slightly in February, however, bringing a correction of sorts, as the same funds that saw a massive increase in January actually managed to shed around 1.31%. Considering the situation within the crypto industry in March, where the prices spiraled down as a response to a global fear caused by the coronavirus outbreak, it is likely that the funds will report significant losses by the end of the month.

Even so, hedge funds that were not meant for investors specifically still saw a major positive influence whenever cryptocurrencies were included, according to reports. This has been a common theme in the last few years, and one case from 2019 saw a hedge fund of a well-known investor, Bill Miller, experience a growth of more than 40%. The reason for the growth is believed to be the fact that the fund included Bitcoin (BTC).

Even so, since BTC dropped by around 50% in a recent crash, only to recover slightly and continue the price drop after the weekend, the new reports of the funds’ performance are unlikely to be positive. Still, many expect that the situation will take a sharp turn once the fears of coronavirus begin to subside.