Crypto hedge funds are investment vehicles that pool capital from accredited investors to participate in the cryptocurrency markets. These funds goal to maximise returns through varied strategies, including long-term holdings, active trading, arbitrage, and initial coin choices (ICOs). Unlike traditional hedge funds, which might have a broad mandate, crypto hedge funds specialize within the complexities and dynamics of crypto markets.
Bitcoin: The Anchor Asset
Despite the proliferation of cryptocurrencies, Bitcoin stays the bedrock of most crypto hedge fund portfolios. Its market leadership, liquidity, and status as a digital gold commonplace make it a comparatively safer and zaramea01 more stable investment within the crypto space. Most crypto hedge funds maintain a significant portion of their assets in Bitcoin as a hedge against the volatility of smaller altcoins.