By Laura Sanchez
Investing.com – Cryptocurrencies have caught the eye of hedge funds as investors expect a bull run in 2023 and 2024 in a sector that has tumbled more than $2 trillion since last November.
Nearly a third of traditional hedge funds currently invest in crypto-assets. Two-thirds or 67% of these hedge funds aim to deploy more capital into the emerging asset class by the end of 2022, according to a report by the Alternative Investment Management Association picked up by Financial News.
According to experts, interest in the asset class, like and , remains high. The FOMO (fear of missing out) factor also plays a major role, as the “strong hands” don’t want to miss a rally in the cryptocurrency market. In fact, FOMO already outweighs the potential risks in this sector.
In recent years, hedge fund giants such as Ray Dalio and Daniel Loeb have changed their minds about bitcoin and other cryptocurrencies. Dalio, who had once expressed concern about the sector, said in January that it was reasonable to allocate up to 2% of his portfolio to .
Hedge fund billionaire Loeb also dabbled in cryptocurrencies last year, holding an unspecified amount of cryptocurrency with Coinbase (NASDAQ:).
This is a combination of the likelihood that the market has bottomed out and the anticipation of the next bull run, which could occur in 2023 or 2024, when bitcoin next halves. The bitcoin halving takes place every four years, due to the fixed rule inherent in the network that governs the cryptocurrency, which guarantees that there will only be 21 million bitcoins in circulation, reports Financial News.