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FxWirePro: Bitcoin volatility never stops and so is hedge fund flows

The journey from $751.34 to a whopping $17,270 (at BITSTAMP exchange), or 2,199% in this year so far with a fortnight trading spare:

BTCUSD surged to almost a mammoth 195% in this month. But please be mindful about the price oscillation before such mammoth price spikes, the price tumbled from the peaks of $19697 to the lows $13788, bounced back again to $16,711, slumps again to $13,501 before the climb over to $18,149. Likewise, you get to see many oscillations before it achieves to the current levels of $19,117.

Amid this price developments, hedge fund flows have poured in cryptocurrencies that have had an average return of 1,522% this year, compared to an average of 7.2% for hedge funds invested in conventional assets classes.

Newly invented blockchain technologies have attracted investor interest in funds and cryptocurrencies have surged in recent months as these innovations continue to move towards the mainstream and generate compelling opportunities for investors, portfolio managers, traders and other market participants.

The HFs note to investors points out that in 2017, cryptocurrency markets and trading platforms have come up with better liquidity and stability, as additional products have been added in an attempt to tame the volatility of Bitcoin.

The precise sum-up for hedge funds generated around Bitcoin in 2017 has been indistinct, but some reckon that there are more than 120 new entities. So far, the high liquidity of the BTC market price seems to fit well with the strategies of hedge funds. An approximate projection foresees crypto funds with $2.3 billion of assets under management- still a comparatively small amount compared to traditional asset and wealth managers.

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