Report: London-based hedge fund giant Marshall Wace exploring new exposure to crypto sector

Hedge fund giant Marshall Wace is exploring the possibilities of investments in the crypto sector, insiders told the Financial Times. This is in line with the tendency of the growing interest of large asset managers in digital assets according to the report.

Fund to invest in stablecoins, digital currency payment systems

Marshall Wace, whose managed assets are valued at $55 billion (£39.82 billion) and is based out of London, will invest in stablecoins, digital currency payment systems, and blockchain technology among other areas, according to the report. The London-based hedge fund’s upcoming portfolio will build interest in developed digital private finance businesses. The initiative comes at a time when more and more conventional financial institutions, such as banks, consultancy firms, and fund managers, are aiming to increase their exposure to digital assets.

Marshall Wace is not the only giant hedge fund that’s been eyeing the dynamic digital assets industry. Brevan Howard moved some assets into crypto. Renaissance Technologies disclosed plans to invest in Bitcoin (BTC/USD) last year.

Fund exploring new yield avenues  

Earlier in 2021, Marshall Wace launched a fund to invest in healthcare companies before they are floated and then hold on to their assets as part of their policy to explore new avenues of yield and return in private markets. The new launch is led by Marshall Wace Asia CEO Amit Rajpal, who co-founded Indian fintech firm and small business loan issuer Niyogin.

At the end of May, Marshall Wace participated in a fundraising round for Circle, which raised $440 million. Circle is a fintech that launched USD Coin (USDC/USD). From the beginning of 2021 to end-May, Marshall Wace’s Tops Market Neutral fund has grown by 11 per cent. The fund conducts meta-analyses of buy and sell recommendations.

How lasting will hedge funds’ interest in crypto be?

According to a recent survey, hedge funds anticipate increasing their exposure to crypto significantly – more specifically, to an average of 7.2% of their total assets – in the next five years. Not all of them have jumped the bandwagon, however. One that hasn’t is Elliott Management. In a letter seen by Financial Times, Elliott stated that cryptocurrencies had the potential to become “the greatest financial scam in history”.

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Publication date: 
07/06/2021 - 14:26

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