Recent crypto market turmoil has prompted traditional hedge funds to adopt a more cautious approach to digital assets investments, with some managers opting to exit the sector completely, according to a report by Reuters.
The report cites the results of a new survey by PWC and the Alternative Investment Management Association (AIMA) as revealing that the proportion of global hedge funds investing in crypto-assets has dropped to 29% this year from 37% in 2022.
In addition, a quarter of those currently invested in cryptocurrencies and digital assets said they may consider exiting the asset class altogether due to increased uncertainty over US regulation of the sector.
Traditional hedge funds not currently trading in crypto, cited reputational risk, a lack of clear guidance from regulators and tax authorities, and unreliable data as deterrents.
