Data Shows Hedge Funds Turn Cold On Bitcoin: A Sign Of Trouble For Crypto?

The crypto landscape is witnessing a notable shift in strategy among hedge funds, with Bitcoin exposure at its lowest since October 2020.

Particularly, the ETC Group’s latest research highlights these funds’ significant decrease in Bitcoin holdings, marking a strategic shift that could have broader implications for the cryptocurrency market.

Towel Thrown For Bitcoin

André Dragosch, Head of Research at ETC Group, points out that crypto hedge funds have dramatically scaled back their BTC exposure. Over the past 20 trading days, exposure has fallen to a mere 0.37, the lowest since October 2020, Dragosch revealed.

This reduction reflects a cautious or bearish sentiment towards Bitcoin within the professional investment community amid the asset’s current struggle to rally.

This cautious approach from hedge funds coincides with continued outflows from crypto exchange-traded products, suggesting a broader trend of reduced confidence among institutional investors.

Dragosch also noted that hedge funds typically exhibit pro-cyclical behavior—tending to invest in line with market trends—which could mean a slow return to Bitcoin if the market rallies.

BOOM: Crypto hedge funds have really thrown in the towel on #Bitcoin lately.

They have reduced their $BTC market exposure to only 0.37 over the past 20 trading days. Read More