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World’s Largest Hedge Fund To Invest in Crypto

Key Insights:

  • Bridgewater Associates wants to increase its exposure to digital assets.

  • The $150 billion hedge fund will not be buying cryptocurrencies directly.

  • Billionaire Ray Dalio had previously advised investors to allocate a small portion of their portfolios to BTC.

The world’s largest hedge fund is readying investments in an “external vehicle” and won’t be dabbling directly in the crypto-asset markets.

Billionaire Ray Dalio’s fund currently has $150 billion in assets under management (AUM), and it wants a slice of the digital asset pie. The man admitted to owning some Bitcoin (BTC) last year, so the move has not been unexpected.

However, according to reports, the size of Bridgewater’s crypto-related investments is tiny compared to its AUM figure.

Researching Crypto Markets

In January, the company released a report on the “Evolution of Institutional Investors’ Exposure to Cryptocurrencies and Blockchain Technologies,” signaling that it was actively researching the space.

A Bridgewater spokesperson confirmed this in February, telling CoinDesk,

“While we won’t comment on our positions, we can say Bridgewater continues to actively research crypto but is not currently planning on investing in crypto.”

Sources did not elaborate on the details this time around, however. Last month they said Bridgewater is in a first-half plan this year before adding that they planned to have a “small slug of their fund” deployed directly into digital assets.

Another person familiar with the firm’s crypto investment strategy said,

“Bridgewater is looking to get involved. They are doing serious diligence: liquidity, service providers, and whatnot.”

The report added that the firm is following a similar path to hedge funds Marshall Wace, Point72, and Brevan Howard, reportedly making forays into the crypto sector last year.

Ray Dalio cautioned that cryptocurrencies were getting too much attention from regulators in January. However, the billionaire also suggested that investors allocate 1% of their portfolios to Bitcoin in the same month.

Crypto Market Outlook

Institutional interest in crypto assets has increased over the past year, and markets have generally remained range-bound for most of 2022.

Over the past 24 hours, total market capitalization has gained 1.8% to $1.97 trillion. However, it is still down around 36% from its November peak.

Bitcoin has added 1.9% on the day to trade at $41,766 at the time of writing, adding to the 5.3% it has made over the past week.

This article was originally posted on FX Empire


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