{"id":369961,"date":"2019-02-01T08:00:38","date_gmt":"2019-02-01T08:00:38","guid":{"rendered":"https:\/\/wncen.com\/?p=369961"},"modified":"2019-02-01T04:31:49","modified_gmt":"2019-02-01T04:31:49","slug":"depressed-crypto-markets-make-great-buying-opportunities-for-vcs","status":"publish","type":"post","link":"https:\/\/wncen.com\/news\/depressed-crypto-markets-make-great-buying-opportunities-for-vcs\/","title":{"rendered":"Depressed Crypto Markets Make Great Buying Opportunities for VCs"},"content":{"rendered":"
When the first two crypto hedge funds came on the scene in December 2017 the entire market and industry was in a completely different place. Bitcoin was trading in five figures and on a seemingly unstoppable upward surge so shorting it, as these funds allowed for the first time ever, was the better bet.<\/p>\n
Just over a year later the scene is completely different and crypto markets appear to be a desolate wasteland with Bitcoin eyeing further losses below $3,000<\/a>. Shorting long term is less than appealing so the only place to go for venture capitalists is long on Bitcoin and crypto. Hedge funds investing in crypto now are starting to look more like VCs as the ICO market dissolves into a different form of investment.<\/p>\n According to Bloomberg<\/a> there are several VCs that are looking at the long game, Polychain Capital being one that has just raised $175 million for a seven year fund. Arca Funds is another that is considering buying up distressed crypto projects as partner and portfolio manager, Jeff Dorman, explained;<\/p>\n \u201cThere\u2019s going to be a lot of opportunity in distressed buying and even activist investing. Often you can buy below even the cash value of the company.\u201d<\/p><\/blockquote>\n According to Crypto Fund Research around 125 venture funds that provide capital in exchange for an ownership stake were launched in 2018, compared with 115 hedge funds acting as investors. Many of these hedge turned venture funds are focused on acquiring heavily discounted Simple Agreements for Future Tokens (SAFTs) from projects that plan to issue tokens on startup. Pantera Capital<\/a> Management expects to see more companies raising capital this way, as its own fund invests in tokens ahead of ICOs.<\/p>\n