Hedge funds based on cryptocurrencies close the deal

A strong sell-off on the cryptocurrency market has involved some of its participants. According to the latest Crypto Fund Research report, due to the decline in the value of the cryptocurrency market by about 20% in just 2 weeks, until the closure of its operations, 35 has been forced to cryptographic funds.

Bitcoin -70%. Funds involve the interest

The exchange rate of the most popular cryptocurrency, BTC, in relation to the US dollar, decreased by over 70% compared to the valuation from a year ago (December 2017). The first serious market consequences are already visible. Crypto hedge funds are shutting down as the number of companies has grown steadily since early 2018. CFR monitors approximately 630 crypto-related funds. 35 of them have already closed, which is over 5% of the total.

As reported by MarketWatch, the high valuation of many crypto accounts in 2017 allowed hedge funds to quickly and relatively easily acquire huge capital, which had to be invested in the 2018 year. The effect of this was the opening of 44 funds only in January this year. The chart below shows the tendency of cryptocurrency funds being opened, divided into individual months.

source: MarketWatch.com

If the trend in the cryptocurrency market, especially the more popular ones, continues, one can expect the closure of subsequent projects on a massive scale.