BlockTower Capital’s cryptocurrency hedge fund has defied this year’s coronavirus-induced mark crash to give investors who held the fund since its inception until this year a total return of 73%.
According to CoinDesk, the fund unexpectedly doubled its returns this year during the coronavirus-induced market crash, that saw most top equity index funds enter bear market territory in March. The fund was created in August 2017 with $140 million in assets, and gained 33% in the first four months of the year.
In these four months BlockTower’s crypto fund beat BTC, the S&P 500, and hedge funds in and out of the cryptocurrency space. Investors who put their money in at its inception and held on through to last month have gained a 73% return, according to the report.
Its lifetime return have so far outperformed those of the S&P 500, which returned 18% over the last 33 months, but failed to outperform those of the flagship cryptocurrency, which went up 217% since the fund’s inception.
BlockTower did not comment on its return, but a source familiar with the firm said its hedge fund deployed spot, derivatives, ang algorithmic trades “to capture return from extreme movements,” CoinDesk reports.
It traded bitcoin and both liquid and illiquid cryptocurrencies, and switches between holding and liquidating BTC, ETH, four ether competitors, and other cryptos. Its returns surged after it added traditional finance veterans to its team, including a former Goldman Sachs vice president and a Citii accountant and BlueMountain capital hedge fund manager.
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