Hedge Fund Brevan Howard Expands Crypto Business — Expert Hired to Lead New Digital Asset Unit

Brevan Howard, a European hedge fund management company, has said it will be expanding its crypto business. BH Digital, which is the hedge fund’s recently created unit, is expected to “manage its cryptocurrency and digital assets.”

In addition to creating BH Digital, Brevan Howard, according to a Reuters report, has also said it will be hiring Colleen Sullivan, the current CEO of the digital arm of trading firm CMT, to lead private and venture investments in crypto.

The announcement by Brevan Howard, which is reputed “for its bets on macroeconomic trends,” is the latest piece of evidence that suggests that “major hedge funds [are] moving into the world of crypto trading.” To buttress claims that institutional investors are pivoting to crypto, the same report points to recent moves by other high-profile money managers like Paul Tudor and the Man Group which trades bitcoin futures.

In addition, the report also makes reference to an annual report published by Price Waterhouse Coopers, Alternative Investment Management Association, and Elwood Asset Management.

In this annual report, it is shown that the value of total assets under management (AUM) of crypto hedge funds globally nearly doubled to $3.8 billion in 2020 from $2 billion in the previous year.

Meanwhile, Stuart Cole, the head macroeconomist at London-based Equiti Capital, is quoted in the report explaining how institutional investors’ perception of cryptocurrencies has changed over the years. Cole notes:

What was initially seen as something of a fad now appears to be becoming a more permanent structure of the financial landscape and this has started to see what were initially fringe financial instruments moving to become more mainstream and very much forcing the institutional interest we are now seeing.

However, the report still acknowledges that not all large corporations are embracing cryptocurrencies. It notes that while hedge funds and exchanges are scrambling to “capture trading revenues,” global banks have been slower in their approach.

This approach by banks has persisted despite the pressure from their wealth management clients to offer cryptocurrency trading.

Do you agree that more institutional investors are venturing into crypto? Tell us what you think in the comments section below.