CoinShares Launches Hedge Fund Division to Attract American Investors
Crypto asset manager CoinShares has recently announced the launch of a hedge fund division aimed at attracting accredited investors in the United States. This new division will complement the company’s existing portfolio of exchange-traded products (ETPs). According to CoinShares’ CEO, Jean-Marie Mognetti, the current market conditions, characterized by high interest rates, offer interesting opportunities to outperform traditional markets due to monetary policy, volatility, and macro uncertainty.
CoinShares’ Filing Follows SEC Rulemaking Blitz
In an effort to expand its operations in the US, CoinShares filed paperwork with the Securities and Exchange Commission (SEC) during the summer to launch two feeder funds focused on Bitcoin (BTC) and Ethereum (ETH). However, specific details regarding the investment approach of the new hedge fund have not been disclosed publicly. It is worth noting that in August, the SEC mandated quarterly performance and expense reports from private funds, including hedge funds, aiming to protect investors from unfair practices.
Accredited Investors Struggle to Invest in Crypto Funds
The attempt to create crypto exchange-traded funds (ETFs) for American investors on Wall Street has faced challenges. The SEC has demanded better market surveillance from ETF applicants to combat manipulation, leading to delays in ruling on revised filings. Additionally, major crypto funds tracking futures and other derivatives have experienced consecutive weeks of outflows. Analyst Vetle Lunde explains that the correlation between crypto assets and equities has declined significantly from previous bear market highs.
Hot Take: Future Fed Decisions May Have Minimal Impact on Crypto Markets
As a result of declining correlations between Bitcoin, the Dollar Strength Index, and US equities throughout 2022, future Federal Reserve decisions and macro events are expected to have minimal impact on crypto markets. Analyst Vetle Lunde suggests that correlations are approaching levels seen before the COVID-19 pandemic, indicating a potential shift in market dynamics. Higher Federal Reserve rates have also led American investors to opt for lower-risk investments like long-term government treasuries.
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