Despite the fact that the price of cryptocurrency is at annual lows, large market players are finding ways to generate income. In his interview, the head of the foundation Polychain Capital Olaf Carlson-Wee spoke about his vision of the situation.
The downtrend in the cryptocurrency market forced investors to change their attitude to these assets. Many hedge funds began to look for new solutions, and some of them completely ceased operations. As the hedge fund index Eurekahedge shows, about 70% of cryptocurrency funds lost up to 70% of the share capital. 42 of them have stopped working. However, not everything is so sad.
The first of their funds, which was able to reach the level of $ 1 billion, is under the control of Olaf Carlson-Wee. In this situation, he also suffered significant losses, but is not going to close.
The company managed to raise another $ 175 million to form a venture fund. And it will be possible to withdraw funds from it not earlier than in 7 years. It is planned to place funds in those projects that are now in a difficult financial situation.
When the market falls, investors panic. This is an expected reaction, and it leads to natural consequences. Assets are beginning to be sold much cheaper than their real value. No one can say for sure exactly when the bear trend will stop. However, there is no doubt that it will be finished.
Most likely, there will no longer be such rapid growth in demand. However, most players recognize that cryptocurrency has great potential for growth. Now the price is at the lowest point, and it’s the most profitable time to buy coins.
Investors are changing the approach to this, they are less interested in hedge funds with quick payouts. Market attention has been riveted on venture capital funds with long-term capital allocation strategies. The data for 2018 show that for the first time, interest in venture capital investment exceeded hedge fund placement requests. The market is waiting for growth. But it does not believe that this process will come tomorrow.