Victor Ugochukwu · Dec 14, 2020 . 5min read
Neural Capital, another Crypto Hedge Fund Bites the Dust
The crypto hedge fund, Neural capital is in the process of refunding leftover money to investors, it show that Crypto hedge funds businesses are challenging
By Victor Ugochukwu · Aug 3, 2020 . 5min read
Neural Capital, a crypto hedge fund trading in digital assets, bite the dust after posting a series of losses.
According to Coindesk report, the fund has lost half its money since launching in 2017. The crypto hedge fund is now in the process of refunding leftover money to investors. Apparently, Neural Capital liquidated its crypto-assets in December with some still held up in escrow. The funds in the escrow have taken longer than necessary.
The hedge fund’s financial report shows it managed over $13 million in 2019. Its investors include Joshua Elman from Greylock and Hooman Radfar from Expa funds.
About 40 persons invested a minimum sum of $250,000 in the hedge fund.
Earlier before this, Neural Capital run by Arij Nazir and Christopher Keshian had stopped filling to the state of California. Additionally, the fund withdrew its registration with the U.S. Securities and Exchange Commission in December.
Keshian speaking to media houses on this development deflected giving a direct response on the matter. He said,
“Right now, I’m working on a project that is still very much under wraps,”Christopher Keshian
Neural Capital biting the dust adds to the number of failed funds focussing on the crypto industry. According to a Bloomberg report, almost 70 crypto hedge funds closed shops in 2019 alone. North America had 28, some 23 in Europe, and 17 in Asia/Pacific and other regions.
Surprisingly, a PWC report in May states that the total AuM of crypto hedge funds globally doubled. It increased to over US$2 billion in 2019 from US$1 billion the previous year. However, the median crypto hedge fund returned +30% in 2019 (vs – 46% in 2018).
Contrary to expectations, crypto hedge fund businesses didn’t really explode.
Even though names like Fidelity and ICE Markets entered in 2019, the market didn’t explode as the industry expected. In fact, Mike Novogratz’s Galaxy Digital only recently started posting profits. It had posted $272.7 million losses in 2018. The losses continued until Q4 of 2019.
However, with Grayscale adding Bitcoin Cash and Litecoin to its list of assets, perhaps hedge fund business in 2020 isn’t really bad after all.