Cryptocurrency funds are a new type of investment vehicle that parallels traditional portfolio investments, like hedge funds, but are composed entirely out of digital assets. Because of this, they play by slightly different rules than their legacy counterparts. Knowing how they differ and where to get involved is key for those who want to jump into this intriguing new world, so we’ve outlined the main points in this helpful guide.
The term “cryptocurrency fund” refers to a portfolio containing a variety of different digital assets and is usually managed by one or a few individuals. Investors are then able to buy into these funds so that they can share in the profits as the value of the fund grows. According to data from Crypto Fund Research, a little over half of these act as venture capital funds, while the rest are predominantly hedge funds.
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