Hedge funds retreat from cryptocurrencies after 2022 FTX scandal, US regulatory crackdown: PwC survey
- A survey of traditional hedge funds found that only 29 per cent were investing in virtual assets this year, down from 37 per cent last year, PwC said
- Nearly 70 per cent of respondents said that events in 2022 impacted their intention to deploy more capital into the sector last year, the report noted
A survey of traditional hedge funds, which do not focus on cryptocurrencies, found that only 29 per cent were investing in virtual assets this year, down from 37 per cent last year, PwC said in a report published on Wednesday in conjunction with the Alternative Investment Management Association (AIMA).
The collapse of several crypto-related companies last year forced global funds to “re-evaluate” the role of cryptocurrency assets in their portfolios, PwC said.
The virtual asset industry crashed in the second half of 2022, following the downfall of several high-profile players, including most notably FTX, previously the world’s second-largest cryptocurrency exchange. While bitcoin price recovered this year, the sector still faces headwinds such as high interest rates and a toughening regulatory approach in the US.
Nearly 70 per cent of survey respondents said that events in 2022 impacted their intention to deploy more capital into the sector last year, the report noted.