crytpto hedgefunds are shutting down massively

[exstasie]

I'm sure that a few funds will continue to exist and they'll post huge profits because they're run by people who know what they're doing.

Does anyone know what they're doing? Since this class of person has arrived in cryptoland I'm not sure I can remember a single one of them making a statement on this area that I found remotely insightful. It's the peeps who've been here forever who have a better idea of what's what.  

I don't think arriving with conventional market experience is going to put you ahead as this ably proves.

You're only thinking about the late entrants. There have been hedge funds in this space since 2013, some of which are incredibly successful. Pantera Capital said a few months ago they were up 10,136.15% after fees and expenses since they launched. If you look back at what Morehead was saying back in 2013, the guy was a visionary. Altana has been around since 2014 and made 1500% returns last year. There are others as well.

To be fair, nobody knew how prolonged this bear market would be. Conventional wisdom said a multi-year bear was possible, but you'd be a fool to assume it was going to happen. It's difficult to fully hedge a diversified portfolio against a prolonged bear market. In a global economic crash, every market contracts, meaning there is no safe haven. Cryptocurrency markets are the same, just on a smaller scale. People think "why don't they just short?" They can and do, but they can't just perpetually stay net short. They need to limit counterparty exposure and more importantly, they need to ensure proper liquidity to exit shorts...... not easy in super thin crypto markets, particularly altcoins.

Just like late bubble buyers, late entrant funds who were under-capitalized or didn't hedge properly are getting squeezed. I don't think that's characteristic of all hedge fund activity in the space though.

[gentlemand]

You're only thinking about the late entrants. There have been hedge funds in this space since 2013, some of which are incredibly successful. Pantera Capital said a few months ago they were up 10,136.15% after fees and expenses since they launched. If you look back at what Morehead was saying back in 2013, the guy was a visionary. Altana has been around since 2014 and made 1500% returns last year. There are others as well.

To be fair, nobody knew how prolonged this bear market would be. Conventional wisdom said a multi-year bear was possible, but you'd be a fool to assume it was going to happen. It's difficult to fully hedge a diversified portfolio against a prolonged bear market. In a global economic crash, every market contracts, meaning there is no safe haven. Cryptocurrency markets are the same, just on a smaller scale. People think "why don't they just short?" They can and do, but they can't just perpetually stay net short. They need to limit counterparty exposure and more importantly, they need to ensure proper liquidity to exit shorts...... not easy in super thin crypto markets, particularly altcoins.

Just like late bubble buyers, late entrant funds who were under-capitalized or didn't hedge properly are getting squeezed. I don't think that's characteristic of all hedge fund activity in the space though.

I wouldn't class places like Grayscale, Xapo and Pantera as 'this class of person'. They've had a hand in creating the Bitcoin scene. All these places crashing and burning are put together by comparative nobodies arriving from nowhere.

Don't really get how anyone with an operative mind could've expected anything other than the bubble burst from hell. $3 XRP? That's just beyond ludicrous, let alone the countless dog walking ICOs. It was the most classic and empty bubble imaginable and even more sensible ones come with a heavy bill that demands paying.

[exstasie]

I wouldn't class places like Grayscale, Xapo and Pantera as 'this class of person'. They've had a hand in creating the Bitcoin scene. All these places crashing and burning are put together by comparative nobodies arriving from nowhere.

I wouldn't lump Pantera in with them. Pantera is just a hedge fund. They're not creating infrastructure for the Bitcoin ecosystem. They're just investors, like Tim Draper's fund.

Don't really get how anyone with an operative mind could've expected anything other than the bubble burst from hell. $3 XRP? That's just beyond ludicrous, let alone the countless dog walking ICOs. It was the most classic and empty bubble imaginable and even more sensible ones come with a heavy bill that demands paying.

It just goes to show you that hedge funds, even those formed by Wall Street institutions, can get caught up in the bubble hype like everyone else.

Keep it in perspective though. Fortress Investment Group (Novogratz) was the first Wall Street company to invest in BTC. They bought the top in 2013. They ended up rolling that stash into equity in Pantera, which became one of the industry's biggest success stories.

Where is Novogratz now? He was overly bullish early in the year, on ICOs no less, and Galaxy is down hundreds of millions USD on the year. That's just to say, there's blood in the streets wherever you look.

[clrpod]

I'm sure that a few funds will continue to exist and they'll post huge profits because they're run by people who know what they're doing.

Does anyone know what they're doing? Since this class of person has arrived in cryptoland I'm not sure I can remember a single one of them making a statement on this area that I found remotely insightful. It's the peeps who've been here forever who have a better idea of what's what.  

I don't think arriving with conventional market experience is going to put you ahead as this ably proves.

Agreed, that's why I think only a few will achieve some success. But with a hedgefund it's not so much about knowing what they're doing but having the right contacts to gain investment and then the right people to make the correct decisions when it comes to investments.