According to a study conducted by the major financial services firm PricewaterhouseCoopers (PWC) titled “4th Annual Global Crypto Hedge Fund Report 2022,” the majority of crypto fund managers surveyed believe that the price of bitcoin will be between $75K and $100K by the end of this year.
The report was created in collaboration with the Alternative Investment Management Association (AIMA) and Elwood Asset Management.
The data in the report comes from a survey conducted in April among a sample of 77 specialist crypto hedge fund managers, and their total assets under management (AUM) in 2021 will be $4.1 billion.
Crypto hedge fund managers remain bullish on BTC
The report includes bitcoin price predictions, as the Big Four accounting firm described that they gave crypto fund managers the chance to contribute their forecasts on where the price of BTC and the global cryptocurrency market capitalization would be on December 31, 2022.
The findings revealed that, while the overall crypto market was bearish, managers remained extremely bullish on BTC, noting that “the median prediction of BTC price is $75,000,”
The majority of predictions (42%) placed the BTC price between $75,000 and $100,000 by the end of 2022, with another 35% placing it between $50,000 and $75,000 by the end of 2022.
The total assets under management (AUM) of cryptocurrency hedge funds increased to $3.8 billion, up from $2 billion the previous year, according to the report.
The best performing strategy for crypto hedge funds was Discretionary Long Only (up 294%), a strategy that emphasises investing over a longer time frame and holding more liquid cryptocurrencies.
Bitcoin keeps leading
Aside from the significant growth in cryptocurrency hedge funds over the past year, the report also demonstrated how bitcoin has maintained its dominant position, both within cryptocurrency hedge funds and in more traditional funds.
PWC United States’ global financial services leader, John Garvey, commented on the report, saying that the recent collapse of Terra vividly demonstrated the potential risks in digital assets. Volatility will continue, but the market is maturing.
Traditional hedge funds show interest in digital assets
“With that is coming not only many more crypto-focused hedge funds and higher AUM but also more traditional funds entering the crypto space,” John concluded.
38% of traditional hedge funds surveyed are also currently investing in digital assets, up from 21% a year ago.
Around one-fifth of traditional hedge funds (21%) are investing in digital assets, and more than 85% of those funds intend to increase their investments in the cryptocurrency asset class by the end of 2021. More than half of traditional hedge funds said they planned to invest in cryptocurrencies within the next year.
Furthermore, 46% of the crypto hedge funds polled said they are involved in cryptocurrency staking, 44% in lending, and 49% in borrowing.