Cryptocurrency funds were down 29.2 percent in March amid an ongoing slump caused by increased scrutiny from global regulators of the virtual assets, Reuters reports, citing a new index launched by data provider BarclayHedge.
The Barclay Cryptocurrency Traders Index was down 43.1 percent in the year to date, after three consecutive monthly losses, BarclayHedge said.
The Cryptocurrency Traders Index, started in 2018, is an equal-weighted index of the monthly returns of 19 funds that trade bitcoin and other cryptocurrencies.
Volatile bitcoin hit an all-time high of just under US$20,000 in December 2017 and has since fallen to as low as US$5,920. On Wednesday, it was up 4.2 percent on the day at US$8,232 on the BitStamp platform.
Cryptocurrencies have been impacted this year by fears of a crackdown from regulators and concerns that they have been in a speculative bubble that is now deflating.
“Folks have their opinions, but no one really knows if it’s a bubble or a correction,” said Sol Waksman, president and founder of BarclayHedge.
Data from financial technology data tracker Autonomous NEXT also confirmed the bear trend.
“There has been a slowdown in ICO (initial coin offering) proceeds that we track ($US1 million and over), with a dip in February and a slight pickup in March in terms of fundraising,” Autonomous NEXT said in a report also published this week.
ICOs are a fund-raising mechanism in which startups create currencies or tokens and sell them to investors.
“There is also definitely a slowdown in terms of ICOs starting in March. So it seems that the public crowd-funding part of the equation is indeed getting slower, looking like the summer of last year, rather than the frenzy of the fall/winter,” London-based Autonomous NEXT said.
The number of new funds in the company’s crypto fund tracker has also grown modestly in 2018, it said.
Autonomous NEXT said it is tracking 251 crypto funds.
“The number is not growing as quickly as we’d expect – partly because it’s a more difficult environment to raise, and partly because folks are being less vocal about what they’re doing,” the company said.
Crypto startup raises US$133 million
In New York, a startup launched by three Princeton University graduates for a new cryptocurrency has raised US$133 million from a slew of big investors in a private placement, Intangible Labs chief executive and co-founder Nader Al-Naji said on Wednesday.
Intangible Labs is the creator of basis, a digital currency that aims to maintain a stable price and be usable around the world.
The company’s investors included Bain Capital Ventures, Google’s venture arm GV, venture capital firm Andreessen Horowitz, and Lightspeed Foundation Capital, Al-Naji said.
Billionaire hedge fund manager Stan Druckenmiller and former Federal Reserve Governor Kevin Warsh also invested in the company.
The new token is built on the ethereum blockchain and has a built-in mechanism that controls its own supply to keep the price stable, Al Naji told Reuters in an interview.
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