While there’s a huge uproar around institutional Bitcoin (BTC) investments, hedge fund giant One River Digital Asset Management has made a quiet and smart accumulation of more than $600 million in cryptocurrencies, reports Bloomberg.
As per the latest report, the hedge fund giant has pledged a total of $1 billion for Bitcoin (BTC) and Ether (ETH) purchases by early 2021. CEO of One River Asset Management – Eric Peters – said that he has specially set-up a new company – One River Digital – to handle crypto investments. the hedge fund CEO has also joined hands with Alan Howard, the co-founder of Brevan Howard Asset Management.
“There is going to be a generational allocation to this new asset class. The flows have only just begun,” said Peters.
In addition to investing in One River Digital’s funds, Howard will also be buying a stake in the business. Besides, Howard’s own company – Elwood Asset Management – will also provide market analysis, trading services, and technical support to One River Digital.
As per the Bloomberg report, Peters had already anticipated a spike in Bitcoin (BTC) and Ether (ETH) early in October 2020. As a result, One River Digital completed its Bitcoin purchased in November last month under the price of $16,000. The company’s investment has already fetched nearly 30% returns as Bitcoin (BTC) price skyrockets over 6.6% today hitting an all-time high above $20,600.
COVID-19 Pandemic Is the Ultimate Bitcoin Catalyst
The COVID-19 economic crisis has been the biggest boost for crypto assets. Unprecedented monetary-policy measures have pushed institutions closer to Bitcoin and cryptocurrencies. As a result, there’s been a flood of institutional money coming to Bitcoin over the last few months.
“Covid-19 provided the ultimate catalyst for that transition,” Peters said. “This is the most interesting macro trade I’ve seen in my career.”
Peters also added that his goal is to build a “blue-chip fiduciary” for institutional players seeking exposure to digital assets. The funds will charge 1% of the total trading amount and will allow investors to sell in a day’s time. The currency debasement and inflationary fears have also driven investors’ attention towards Gold. However, Peters adds that Bitcoin (BTC) and Ether (ETH) can outpace the rise.
“There definitely are more risks to this than gold, which has been around for thousands of years, but there’s also way more convexity,” he said. “There are very few convex bets that’ll help your portfolio when these macro forces start playing out.”
Another investor with One River Digital is the UK-based investment giant Ruffer LLP. Ruffer recently disclosed its 2.5%p position in BTC calling it “a small but potent insurance policy against the continuing devaluation of the world’s major currencies.”
To keep track of DeFi updates in real time, check out our DeFi news feed Here.