Guggenheim Partners, one of the world’s largest fund managers with $ 270 billion in client assets under management, is seeking exposure to Bitcoin as part of a new fund, according to a filing with the U.S. Securities and Exchange Commission (SEC).
The fund, officially “Guggenheim Active Allocation Fund”, will invest in cryptocurrencies (mainly Bitcoin) as part of a larger group of traditional and alternative investments. He will use quantitative and qualitative analysis to identify securities with attractive relative value and risk – reward characteristics.
The Fund may seek investment exposure in cryptocurrencies (specifically Bitcoin), often referred to as “virtual currency” or “digital currency”, through cash-settled derivatives,” the filing said, explaining that this includes exchange-traded futures with cash settlement or investment vehicles that offer exposure to Bitcoin or other cryptocurrencies through direct investments.
However, does not stand out a bullish picture for Bitcoin in the filing. Guggenheim addresses the many risks that cryptocurrencies are vulnerable to, including their volatile nature, the possibility of crypto exchanges going offline, cyber risks, negative public perception, and the general risks associated with any technological investment.
On the plus side, however, Guggenheim points to several factors that promote the development of the entire crypto market:
“Factors affecting the further development of cryptocurrencies include, but are not limited to: continued global growth or possible cessation or reversal of cryptocurrency adoption and use, changes in consumer demographics and public preferences, and the use of the networks that support digital assets to develop smart contracts and distributed applications.“
Bullish to bearish
The development comes against the backdrop of Guggenheim’s filing with the SEC to invest up to 10% of its $ 5.3 billion “macro Opportunities Fund” in the Grayscale Bitcoin Trust – a regulated institutional vehicle that allows investors to invest in Bitcoin.
Guggenheim’s CIO Scott Minerd has since commented on the Bitcoin price several times. Last year, he stated that the asset could be valued at up to $400,000 in the coming years, citing scarcity and protection against inflation as key drivers.
Text credit: cryptoslate