New York-based cryptocurrency hedge fund Tetras Capital has announced the closure and refund of funds to investors due to unprofitability and losses that have amounted to 75% since the fund’s inception.
Tetras Capital, founded in 2017, specialized in altcoin trading. The founder of the fund was Alex Sunnarborg, a former analyst at the investment company and information portal Coindesk. He managed a cryptocurrency fund with partners Brendan Bernstein and Thomas Garrambone, who worked as analysts at investment banks Goldman Sachs, JPMorgan, Deutsche Bank and Torreya Partners.
According to the financial report of Tetras Capital, prepared for the US Securities and Exchange Commission (SEC), the fund managed more than $ 33 million in assets and worked with 60 investors. The minimum deposit for each investor was $ 100,000. According to the management of Tetras Capital, in May 2018, the fund opened a short position on ether at a coin price of $ 700. Now the fund has joined the ranks of firms that have suffered losses due to the fall in the rate of cryptocurrencies after the “altcoin boom” in 2017.
According to Crypto Fund Research, about 70 cryptocurrency hedge funds around the world closed in the past year . This figure is almost double the figure for the year before last. In 2018, about 35 cryptocurrency funds ceased their activities. It was also reported last week that hedge fund Prime Factor Capital was forced to liquidate despite being licensed by the UK Financial Conduct Authority (FCA). The reason for the closure was insufficient demand from institutional investors.
However, Tom Jessop, President of Fidelity Digital Assets (FDAS) , believes that the cryptocurrency industry is just evolving, so the closure of cryptocurrency hedge funds is a natural process and “classic early stage” of its development.