The Russia-Ukraine crisis is getting worse, so investors are turning to crypto funds and businesses.
New York City, people around the world are buying shares in cryptocurrency funds and businesses because they want to get a piece of a sector that many think can withstand the fallout from the Russia-Ukraine conflict.
Investors in venture capital (VC) funds spent $4 billion in the crypto space in the last three weeks of February, according to a note from Fundstrat. Data shows that VCs gave another $400 million to start-ups in the sector last week.
There has been a lot of money coming in on a weekly basis. Investments in the industry have been averaging anywhere from $800 million to about $2 billion a week since the beginning of the year, data from Fundstrat shows,
Almost $3 billion in new crypto funds were also raised in the last two weeks, the most so far this year, as of Friday.
People who work at Decasonic, a $50 million fund that invests in both digital assets and venture capital, say that the conflict in Ukraine has made our financial and digital economy more dangerous, which has led to a big rise in blockchain use. People want to invest up to $200 million in his fund.
Because interest rates are going up, some people are moving their money away from real estate and bond funds. I’ve seen this happen with my funds, but because I’m closed-end, I can’t accept more funds or investors, “Hsu said.
U.S. investors took a net $7.8 billion out of bond funds in the week ending March 9. Refinitiv Lipper data shows that. Then, read more.
Real estate funds lost $707 million in the same period, after losing $1.15 billion the week before. This comes after the funds lost $1.15 billion the week before. Then, read more.
George Melka, the CEO of crypto broker SFOX, said that “Crypto native companies are still raising money at very high prices and many funding rounds are still oversubscribed.” There are a lot of crypto startup valuations that are the highest I’ve ever seen.
People who work for private equity firm Bain Capital are starting a $560 million fund that will only invest in crypto-related businesses. Bain Capital Ventures, a unit of Bain Capital, made the announcement last week.
Coins and other crypto assets have done better than traditional risky assets like stocks during the crisis. Bitcoin went up 12.2% last month, and Ether went up 8.8%. Since February 24, when Russia invaded Ukraine, cryptocurrency prices have risen 14.5 percent and 13.5 percent, respectively.The S&P 500 (.SPX) gained only 3.2 percent.
CASH IS FLOWING, AND THE HEDGE FUND IS RETURNING
Crypto investment products and funds attracted $163 million in new institutional money in the two weeks before March 4, according to data from CoinShares, an asset manager. The data showed that blockchain equities, on the other hand, saw inflows of about $15.6 million.
So far this year, we have seen the largest amount of money at $127 million. A company called CoinShares says that in late January, after five straight weeks of outflows, the flow of money into the crypto sector started to go in the right direction.
The returns on crypto funds have levelled off. This is good news.
According to the data that was posted on Monday, the BarclayHedge index of cryptocurrency traders was down 1.5% in February. There were 39 funds reporting, which is about 43% of the crypto asset managers the index tracks, so that’s a lot. In January, the index went down almost 13%, and in December, it went down a little less than 10%.
People at BitBull Capital, which runs a crypto fund of funds and two hedge funds, say there isn’t a lot of panics even though there’s a lot of tension in Ukraine.
During the year, BitBull’s two hedge funds were up, DiPasquale said, thanks to the rise in bitcoin and ether prices in February, which helped them.
It’s because prices have gone up over the last few years that people are starting funds, he said.
