Despite its promises, investing in cryptocurrencies is not an easy endeavor. Investors need to select the right digital assets among a large basket of potential tokens. Furthermore, you need to take care of the custody of the funds that you purchase. As you hold your cryptocurrencies you need to navigate through the unusually high volatility and pronounced market cycles. Eventually you need to record all transactions and manage your taxes which can be very time consuming.
The Advantages of Investing Into a Crypto Hedge Fund
For accredited investors investing into a Crypto Hedge Fund can be an interesting alternative compared to managing their cryptocurrency portfolio on their own. An important aspect is that a crypto hedge fund will take care of the custody of your funds. You don’t need to deal with hardware wallets and moving your funds out of the exchanges. On top you face no risk of being the victim of a theft or losing access to your digital assets.
Furthermore, investing into a crypto hedge fund will simplify your tax declaration. You won’t need to declare that you hold any cryptocurrencies since you do not control them directly.
A well designed crypto fund such as BitBull Capital’s fund of funds will also take care of diversifying your investment into different market segments so that you can benefit broadly from the market development of the most dynamic asset class. Additionally you benefit from the portfolio management and don’t need to worry about short term market fluctuations.
Who is Eligible to Invest in a Crypto Hedge Fund?
Investments in crypto hedge funds are made with the goal of obtaining outstanding rewards in the long term. However, investing into a hedge fund is only available for institutional investors or accredited investors. In order to qualify as an accredited investor you need to have a net worth of at least 1 million USD not including the value of your primary residence or an annual income of more than 200,000 USD (> 300,000 USD for married people).
In 2020 the SEC expanded the definition of accredited investors to include individuals that qualify for this status based on their professional experience or the completion of certifications. In case you qualify through any of these means your income or net worth condition will be waived.
When is the Best Time to Invest in a Crypto Hedge Fund?
While most investors are jumping into the crypto markets during hype cycles, bear markets are actually the best time to invest from a risk reward perspective. Historically, the 200-week moving average has marked the bottom for Bitcoin bear markets as can be seen in the chart below. As of August 2022 Bitcoin is trading exactly around its 200-week moving average at 23,000 USD. Market observers believe that a weekly close above 24,000 USD could end the most recent downwards move and mark the start of a new upwards trend.
Until 2022 Bitcoin is still the best proxy for the overall health of the cryptocurrency market. As the market trend changes for Bitcoin the momentum will be shifting for the entire cryptocurrency asset class.
In any case the current market prices represent deep value terrain for crypto assets. Therefore the second half of 2022 provides excellent entries for cryptocurrency investments with a time horizon of two years or longer.
How to Invest in a Crypto Hedge Fund?
BitBull Capital is currently accepting new investors. Our crypto hedge fund offers you the opportunity to invest in the world’s first crypto fund of funds. The fund of funds has invested in ten crypto hedge funds and is well diversified. We continuously perform due diligence on new funds before adding them.
In order to invest with BitBull Capital you need to complete the PPM (Private Placement Memorandum) and the subdocs and sign them via Docusign. Additionally, you need to submit your ID for an AML/KYC check with our third party provider. Once all the documentation is complete you can wire the funds. In case you have any questions you can book a call with BitBull Capital at any time.