More than 50% of top U.S. hedge funds are investing in crypto, report says

More than half of America’s largest hedge funds have invested in bitcoin, according to data from investment firm River. Some hedge funds, such as Millennium Management, have about $2 billion of exposure to bitcoin, the world’s largest cryptocurrency, and that number is expected to rise later this year as the cryptocurrency gains greater institutional adoption.

River analyzed the cryptocurrency exposure of the country’s 25 largest hedge funds and found that more than 50% of them have invested in bitcoin. Most of the firms gained this exposure by purchasing bitcoin exchange-traded funds (ETFs), which were launched on U.S. markets this January.

Hedge funds with exposure to bitcoin or bitcoin ETFs include Citadel Investment Group, Mariner Investment Group, Millennium Management, DE Shaw, Point72 Asset Management, Verition Fund Management, Bluecrest Capital Management, Elliot Investment Management and Sculptor Capital Management.

For example, Point72 Asset Management holds 1,089 bitcoins, while rival Schonfeld Strategic Advisors holds 6,734 bitcoins. But despite the growing interest from hedge funds, some firms, such as Bridgewater Associates, AQR Capital Management and Balyasny Asset Management, are choosing to stay out of the game.

However, market analysts are optimistic that bitcoin could reach new highs this year and even act as a hedge against inflation (although this is a major topic of debate in the bitcoin community). One of the top hedge funds investing in bitcoin, Millennium Management, currently manages $67.7 billion in assets and has about 2.5% of those assets in bitcoin. Earlier this year, disclosure forms filed with the U.S. Securities and Exchange Commission revealed that five spot bitcoin ETFs had reached an incredible $1.94 billion.