US-Based Hedge Fund To Increase Bitcoin Exposition to $1 Billion

The large bitcoin institutional investments keep emerging frequently, and the latest one has come from the US-based hedge fund One River Asset Management. After establishing a new company oriented in digital asset investments, the fund has purchased $600 million in BTC and plans to add ETH and expand its holdings to $1 billion in the next few months.

One River Digital Asset Management Invests $600M In BTC

Bitcoin has seen a massive spike in interest from institutional investments in the past few months. The latest one to join the “buy BTC” bandwagon is the Connecticut-based hedge fund specializing in volatility bets – One River Asset Management.

The fund’s CEO, Eric Peters, explained that his company has set up a new venture specializing in cryptocurrency investments called One River Digital Asset Management.

Through its newly-established arm, the hedge fund has purchased $600 million in bitcoin. The company completed all transactions in November before BTC reached $16,000.

Moreover, the organization plans to double-down on its crypto investments by adding Ethereum and expanding its portfolio to about $1 billion as of early 2021. Peters believes that “there is going to be a generational allocation to this asset class,” as the inflows “have only just begun.”

The company’s Long Volatility Fund and Dynamic Convexity Fund enable it to employ volatility and trend-following strategies to earn profits, whether prices are increasing or decreasing. The two funds have risen by up to 40% in 2020 alone.

Peters highlighted the global economic situation following the COVID-19 pandemic, including negative interest rates, fiscal spending by governments, and debt monetization by central banks as the primary reasons for the high market fluctuations.

“COVID-19 provided the ultimate catalyst for that transition. This is the most interesting macro trade I’ve seen in my career.”

Backed By Alan Howard

Alan Howard, the British billionaire hedge fund manager and co-founder of Brevan Howard Asset Management, will have a major role in the new endeavor as well. Apart from investing in the funds oriented towards crypto assets, the company he oversees acquired 25% of One River Asset Management in October.

Additionally, another firm that he controls, Elwood Asset Management, will provide One River’s digital arm with trading services, market analysis, and technical support.