Bitcoin hedge fund is the best-performing hedge fund year to date with a return of 4847% on the back of some 6000% growth in Bitcoin’s value against the dollar this year.
According to Hedgeweek, the hedge fund’s assets under management currently total over $35 million.
Growing popularity of Bitcoin
The Bitcoin has emerged from relative obscurity over the last couple of year, and is garnering a great deal of public attention as a new, transnational virtual currency. Bitcoins emerged as an alternative digital currency in 2008, and are growing in popularity as both a spendable currency and as investment.
Bitcoins are created gradually over time as complex mathematical problems are solved by computers. Only a limited supply of bitcoins exists and only a total of 21 million bitcoins will ever be produced (the last bitcoin is scheduled to be produced in 2140).
Ever since the crypto-currency was first launched and achieved its initial success, institutional investors and hedge fund managers have sought a regulated investment vehicle for Bitcoin placements. EXANTE provided this solution by giving simple access to the Bitcoin Fund. The Bitcoin Fund offers institutions and high-net worth individuals secure and real-time access to the Bitcoin market with a licensed, regulated product.
While the Bitcoin Fund doesn’t charge any performance-based fee, it does charge an annual management fee of 1.75% as well as a 0.5% transaction fee. The fund doesn’t use leverage or derivatives for risk management and there is no discretionary management.
One fund share is strictly equal to the value of one bitcoin, which are bought and sold as investors buy and sell Bitcoin Fund series. EXANTE offers a secondary market for the trading of fund shares and through those shares to bitcoins.
Bitcoin’s recent rally
Bitcoin keeps climbing higher, touching $900 last week as regulators in the U.S. consider what they could be used for and the possibility that they are a legitimate currency.
During last week’s Senate hearing, interested parties received the clearest indication of the government’s desire to grapple with the consequences of Bitcoin’s growth. Drawing a parallel to credit cards and online payment systems like PayPal, the officials at the hearings pointed out that crime should not be a reason to limit innovation.