• Bitcoin outperformed crypto hedge funds in the first half of 2023, gaining nearly 80%.
• A report by 21e6 Capital showed that funding rates on crypto derivatives are still relatively low.
• Crypto-related regulations from around the world have entered the digital asset space in the past year.
Bitcoin Outperforms Crypto Hedge Funds
Bitcoin price gained nearly 80 percent during the first half of 2023 while most crypto hedge funds returned between 10-20 percent during the same period. According to a report by 21e6 Capital, funding rates on crypto derivatives are still relatively low compared to the pre-FTX period.
Crypto Market Disrupted Traditional Investment Industry
The highly decentralized aspect of the crypto market has helped onboard hundreds of millions of global investors during the first decade of its existence, disrupting traditional investment industry that was mostly accessible to few investors. Moreover, more crypto-related regulations from around the world have entered the digital asset space in the past year than any other annual calendar. Additionally, it is expected to play a crucial role in next year’s presidential election in the United States with more than three candidates already using Bitcoin to accept donations.
Interestingly, at least 13 percent of crypto hedge fund managers closed down during their operations during the first half of 2023 due to a lack of proper backing. Furthermore, Bitcoin recorded more than 77 percent in gains during this period compared to an average return of 15 percent from crypto hedge fund managers.
Operational Difficulties for Crypto Hedge Funds
Crypto hedge funds suffer from lagging performance to Bitcoin and a set of operational difficulties such as accessing banking services.
Mainstream adoption of cryptocurrency is expected to happen within coming years and its subject will play an important role in US presidential election next year with donations accepted via Bitcoin . Despite this, Bitcoin remains as undisputed digital asset with significant higher returns compared to average ones made by most crypto hedge funds which also face operational difficulties like accessing banking services .