BlockTower Capital Closes Its Market Neutral Cryptocurrency Fund

According to reports, BlockTower Capital, a digital asset investment company headquartered in Miami, announced the closure of its “market neutral” cryptocurrency fund, which once managed over $100 million in funds. Matthew Goetz, CEO of BlockTower Capital, stated that the venture capital company had already made a decision to close the fund in early 2023 and would return the funds to relevant investors, seeking other investment strategies such as “Real World Assets (RWAs)” in the future.

BlockTower Capital: Will close “market neutral” crypto funds and return funds to investors

In a recent announcement from Miami-based digital asset investment company BlockTower Capital, the firm has closed its “market neutral” cryptocurrency fund. The fund, which once managed over $100 million in assets, will be liquidated and the funds returned to relevant investors. According to Matthew Goetz, CEO of BlockTower Capital, the decision to close the fund had been made in early 2023 as the company seeks other investment strategies such as “Real World Assets (RWAs)” in the future.

Why Did BlockTower Capital Close Its Cryptocurrency Fund?

According to sources close to the company, BlockTower Capital has been struggling with the performance of its cryptocurrency fund for some time. The fund was designed as a “market neutral” strategy, which involves balancing long and short positions in the hopes of generating returns regardless of market direction. However, the volatility of the cryptocurrency markets made it difficult to achieve consistent returns using this strategy.
Additionally, the cryptocurrency market has seen significant fluctuations in recent years, with Bitcoin alone experiencing a drop from nearly $20,000 per coin in late 2017 to under $4,000 in late 2018. These fluctuations make it difficult for investment companies to maintain consistent returns for their investors.

What’s Next for BlockTower Capital?

Despite the closure of its cryptocurrency fund, BlockTower Capital remains committed to the digital asset space. The company has stated that it will be focusing on “Real World Assets (RWAs),” which are investments in tangible assets such as real estate, commodities or infrastructure. This shift in strategy reflects a growing trend in the digital asset industry, as investors seek out more stable and predictable investment opportunities.
According to a recent report from Deloitte, “investors are starting to appreciate the potential benefits of digital assets as a diversification tool even beyond the traditional asset classes.” This includes investments in RWAs, which offer a level of stability and predictability that is difficult to achieve in the volatile cryptocurrency markets.

Conclusion

The closure of its cryptocurrency fund marks a significant turning point for BlockTower Capital, as the company pivots towards more traditional investment strategies. While the company’s cryptocurrency fund may have offered significant potential returns, the volatility of the cryptocurrency markets made it difficult to achieve consistent results.
Moving forward, the company will be focusing on Real World Assets, which provide a level of stability and predictability that is more in line with traditional investment vehicles. This shift in strategy reflects a growing trend in the digital asset industry, as investors seek out more stable and predictable investment opportunities.

FAQs

Q: What is a “market neutral” strategy?
A: A “market neutral” strategy involves balancing long and short positions in the hopes of generating returns regardless of market direction.
Q: What are “Real World Assets (RWAs)”?
A: Real World Assets are investments in tangible assets such as real estate, commodities or infrastructure.
Q: What is the future of digital asset investment?
A: The future of digital asset investment is shifting towards more stable and predictable investment vehicles such as Real World Assets. This reflects a growing trend in the industry towards more traditional investment strategies.