Although the crypto market has had a tough run so far this year, crypto hedge fund launches are on pace for a record high in 2018, according to a new report. 
About 600 hedge funds are set to launch this year, and 20% of them will be crypto-focused.
But while interest in crypto hedge funds is picking up, the value of assets managed by those funds is still meager, standing at less than $4 billion.


While the crypto market has had a tough run this year, the number of new crypto hedge funds is soaring. 
90 crypto hedge funds launched globally since the beginning of 2018, and the total is on pace to reach 120 by the end of the year, according to a new report from Crypto Fund Research, a provider of analysis on crypto investment funds.
If that happens, crypto funds will comprise 20% of all total hedge fund launches in 2018. 
To be sure, crypto hedge funds only started to grow in popularity last year. To put these numbers in context, crypto hedge funds constituted 3% of new hedge funds worldwide back in 2016, but the proportion jumped to 16% in 2017.  

The rise of crypto hedge funds has now become a global phenomenon, with countries including Australia, China, Malta, Lithuania, the UK, and Mexico seeing new fund launches this year, according to the report. About half of these funds launched this year are based in the U.S.
But while interest in launching crypto-focused funds is picking up, the value of assets managed by those crypto hedge funds is still small at less than $4 billion, compared to the entire hedge fund industry, which manages more than $3 trillion assets worldwide. 
Institutional investors have tread carefully around the crypto market, due to the industry's extreme price swings, regulatory uncertainty, and potential for fraud. The industry also faces new enforcement actions against crypto firms.  Bitcoin has fallen about 66% from its peak in January, and the total market cap for all cryptocurrencies has dropped by roughly 70% since mid-January, according to CoinMarketCap.
See also: 

Goldman Sachs is ditching near-term plans to open a bitcoin trading desk, instead focusing on a key business for driving Wall Street investment in crypto
Citigroup has created a new, less risky way of investing in crypto — and it may be a game changer for the industry
'There's no teeth': Here's why a push to self-regulate the crypto industry won't stamp out fraud
Join the conversation about this story » NOW WATCH: How smart contracts will work

More Stories

VentureBeat: Wednesday February 20, 2019

Hedera Hashgraph names Deutsche Telekom and others to its blockchain alternative governing council

Hedera Hashgraph's governing council members for itsblockchain alternative are Deutsche Telekom,DLA Piper, Magazine Luiza, Nomura Holdings, andSwisscom Blockchain.

Bitcoin.com: Wednesday February 20, 2019

Coinbase Wallet App Adds Bitcoin Cash Support

Coinbase announced on Tuesday that users of its wallet app can now directly store their bitcoin cash. The app update will be rolled out to all iOS and Coinbase announced on Tuesday that users of its wallet app can now directly store their bitcoin cash (BCH). The app update will be rolled out to all iOS and Android users in the next few weeks. Both Cashaddr and legacy address formats are supported alongside Bitcoin Cash Testnet for developers.

Crowdfund Insider: Wednesday February 20, 2019

Another Crypto Scam Busted in India

Police in India have arrested four and are seeking a fifth suspect whom they believe used a cryptocurrency scamto steal 1 billion rupees (nearly $14

Crowdfund Insider: Wednesday February 20, 2019

Thai Investors Say They Were Defrauded of $1.34 Million in Bitcoin Mining Scam

30 investors in Thailand who say they were defrauded of 42 million baht ($1.34 million USD) by the owner of a Bitcoinmining scheme formally complained

Bitcoin.com: Wednesday February 20, 2019

Market Cap: A Flawed Ranking System for Valuing Crypto

Market cap is often used as a metric of importance in the crypto industry. Communities will react jubilantly as their preferred coin moves up the Market cap is often used as some sort of a metric of importance in the crypto industry.Communities will react jubilantly

Crowdfund Insider: Wednesday February 20, 2019

Europol Hosts 3rd Global Conference on Criminal Finances and Cryptocurrencies

Europol, Interpol and the Basel Institute on Governance will host the 3rd annual Global Conference on Criminal Finances and Cryptocurrencies in the Hague,