Analyst Note: Top 10 Takeaways from the PwC Annual Crypto Hedge Fund Report

For the past four years, Big 4 Accounting, Consulting & Advisory firm PwC has published an annual report on the state of the global Crypto Hedge Fund (HF) market. This year’s report is a combination of a survey conducted in Q1 2022 along with qualitative inputs from PwC’s crypto team. The survey has responses from over 60 active (or were active in Q1 2022) funds. All charts below are from the PWC report. The full report can be found here.

1. The number of funds continues to grow rapidly, but the average AUM is still small

There are over 300 crypto hedge funds, with more than half launching in the last three years. More funds seem to launch as the market price of Bitcoin increases. While the number of funds has grown dramatically, the average AUM for each individual fund is still small at an average of ~$58 million or a median of $24 million. Still, AUM did grow from 2020 when those figures were only $23.5 million and $8.5 million, respectively. At the end of 2021, there was roughly $4 billion in total crypto HF AUM. The broader hedge fund market ex crypto is over $4 trillion.

2. Best performing fund type? Discretionary Long Only

“Stock pickers” are dead right?! Index everything! You can’t beat the markets! Not in crypto apparently. Discretionary funds were the best performers in 2021 by a wide margin. They also were the only set of funds to, on average, beat an “ETH index” in 2021. Eth returned ~400% for the year while the average discretionary long-only fund returned 420%. Compared to public markets all fund types did quite well.