Crypto hedge funds: What are the biggest crypto hedge funds?
Crypto hedge funds have become a core part of institutional engagement with digital assets. In 2025, many traditional funds include crypto within diversified portfolios, using quantitative, arbitrage and long–short strategies to manage exposure.
Crypto hedge funds have become an established part of the global investment landscape.
Below, we explore some of the leading hedge funds and asset managers shaping the crypto investment space in 2025.
Past performance is not a reliable indicator of future results.
What is a crypto hedge fund?
A crypto hedge fund operates similarly to a traditional hedge fund, pooling investor capital to seek returns through active management.
According to the US Securities and Exchange Commission (SEC), hedge funds are typically open only to accredited or high-net-worth investors due to their risk profile and investment complexity. They often employ sophisticated strategies such as leverage, derivatives and algorithmic trading.
In the case of crypto hedge funds, these strategies extend to digital assets, including tokens, decentralised finance (DeFi) instruments and regulated crypto exchange-traded funds (ETFs).
While some funds invest exclusively in cryptocurrencies, others maintain diversified portfolios across shares, commodities and digital assets. Participation generally requires high minimum investments and is subject to lighter regulation than mutual funds, allowing greater flexibility but also higher risk.
Crypto hedge funds and venture capital firms
Crypto hedge funds differ from venture capital (VC) firms in that they manage liquid assets and actively trade them, whereas VC firms invest in early-stage projects and companies.
However, the distinction is increasingly blurred, as many institutional investors now combine hedge fund and venture-style strategies, balancing exposure between liquid tokens and long-term blockchain infrastructure investments.
The scale of these funds means they can influence liquidity and investor sentiment, making it useful for retail investors to understand the major institutional players shaping the sector.
Leading crypto hedge funds in 2025
The global hedge fund industry reached nearly $5 trillion in total capital by Q3 2025, with crypto strategies forming a fast-growing segment (Reuters, 6 November 2025).
The average crypto fund now manages around $132 million, though only about 9% exceed $1 billion in assets (The Full FX, 7 November 2025). Institutional adoption continues to expand, supported by clearer regulation and the growth of spot crypto ETFs.
| Fund name | Fund focus & highlights |
|---|---|
| Pantera Capital | Multi-strategy: blockchain, DeFi, liquid tokens. Oldest active US crypto hedge fund, with AUM consistently in the multi-billion range. |
| Grayscale Investments | Largest digital-asset manager through products such as the Bitcoin Trust (GBTC) and Digital Large Cap Fund. Total AUM now exceeds $45 billion. |
| Bitwise Asset Management | Index-style approach providing diversified exposure to leading cryptocurrencies, widely used by institutions. |
| Brevan Howard Digital | Digital-asset division of Brevan Howard. Focused on institutional-grade trading, research, staking and governance participation. |
| Multicoin Capital | Venture–hedge hybrid known for early investments in Solana and The Graph. |
| BlockTower Capital | Quantitative and venture-backed strategies, with strong presence in DeFi and infrastructure. |
| IAESIR Crypto Hedge Fund | AI-driven investment platform, among the fastest-growing entrants in the 2025 crypto hedge fund market. |
DCG and Grayscale Investments
Digital Currency Group (DCG), the parent company of Grayscale, remains a key player in digital assets. Grayscale’s total assets under management now regularly exceed $45 billion, spanning bitcoin, ether and diversified digital-asset portfolios. The company has shifted focus to regulated ETF products and institutional custody, while continuing to navigate regulatory challenges and corporate restructuring following previous sector turbulence.
Pantera Capital
Founded in 2013, Pantera was the first US-based cryptocurrency hedge fund and remains a major force in blockchain investing. The firm operates multiple strategies, including liquid token, early-stage venture and institutional-focused funds. Pantera has recovered from earlier market downturns and continues to manage multi-billion-dollar assets, serving a global investor base across DeFi, tokenisation and digital infrastructure.
Morgan Creek Digital
Morgan Creek Digital, the crypto arm of Morgan Creek Capital Management, offers institutional investors diversified exposure to digital assets. It collaborates with Bitwise on the Digital Asset Index Fund, which tracks a basket of major cryptocurrencies such as bitcoin and ether. Recent fund updates have expanded coverage to include regulated crypto ETFs and tokenised assets, reflecting broader market developments.
Brevan Howard Digital
Brevan Howard, a long-established macro hedge fund, launched its dedicated crypto division, BH Digital, in 2021. As of 2025, BH Digital ranks among the largest institutional crypto funds, operating across trading, staking and research. The firm combines traditional finance expertise with blockchain-native teams to manage exposure to DeFi, infrastructure and network governance.
Andreessen Horowitz (a16z) and Sequoia Capital
Venture capital firms such as a16z Crypto and Sequoia Capital continue to influence the digital-asset sector, though they remain VC-first rather than pure hedge funds. Both have raised multi-billion-dollar crypto-specific funds supporting blockchain projects, DeFi platforms and Web3 infrastructure. Their long-term participation signals ongoing institutional interest in the sector’s development.
Other notable funds
Multicoin Capital, BlockTower Capital and IAESIR Crypto Hedge Fund have gained prominence since 2023.
These funds combine quantitative, algorithmic and AI-enhanced strategies with venture-stage investments. Their rise highlights the increasingly diverse strategies and data-driven approaches shaping the hedge fund landscape.
Broader industry developments
Institutional investors such as pension funds and endowments are now allocating to crypto hedge funds, expanding participation beyond family offices and high-net-worth individuals.
The emergence of regulated spot crypto ETFs and derivatives has reshaped market access, offering more liquid and transparent routes to exposure.
- Tokenisation and DeFi infrastructure are now mainstream components of many institutional strategies.
- Service providers including Binance Institutional, Coinbase Institutional and Fidelity Digital Assets have become important partners for fund operations and custody.
- Regulatory progress – including the US GENIUS Act and similar frameworks elsewhere – has encouraged fund establishment and cross-border participation.
Past performance is not a reliable indicator of future results.
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FAQ
How many crypto hedge funds are there?
As of 2025, there are over 400 active crypto hedge funds worldwide, according to recent industry data. More than half (around 55%) of traditional hedge funds now hold crypto assets, compared with roughly a third in 2022. This indicates a continued move towards mainstream adoption of digital assets within institutional portfolios.
How do crypto hedge funds work?
Hedge funds are investment vehicles that pool capital from multiple investors with the aim of generating returns through active management. They are typically open only to accredited or institutional investors and are subject to lighter regulation than mutual funds, allowing them to use advanced strategies such as leverage, derivatives and algorithmic trading.
Crypto hedge funds apply these methods to digital assets, including cryptocurrencies, tokenised products and regulated spot exchange-traded funds (ETFs). Their performance varies depending on market conditions, volatility and each fund’s underlying strategy.
How are crypto hedge funds regulated?
The regulatory environment for crypto hedge funds varies between jurisdictions.
In most cases, these funds are subject to fund-level oversight, covering compliance, custody and reporting, rather than direct regulation of each underlying digital asset.
Recent developments, such as the introduction of the US GENIUS Act and the EU’s MiCA framework, aim to provide greater clarity and investor protection while encouraging responsible participation in digital-asset markets.