London-based investment firm launches new vertical for digital asset investments

Brevan Howard Asset Management LLP made two major announcements today, pointing towards its future crypto expansion plans. Firstly, the hedge fund hired Colleen Sullivan to lead its crypto vertical. Second, it is launching a new vertical for digital asset investments. 

These are significant announcements to streamline its private and venture investment activities in cryptocurrencies. 

CEO Aron Landy said in a statement, 

“Brevan Howard’s belief in the huge diversity of opportunities within the digital asset space and the significance of this to long term macro investors is the reason we are delighted to welcome Colleen to the firm,” 

Before her association with Brevan, Sullivan was the co-founder, CEO, and Partner at Chicago-based CMT Digital. Her division focused on crypto asset trading, blockchain technology investments, along with legal and policy engagement in the vertical. And now that the hedge fund is looking to expand in the same technology vertical, it has also introduced a specialized division called BH Digital.

Earlier in April, the British fund had reportedly allocated 1.5% of its $5.6 billion fund in digital assets. Additionally, apart from Bitcoin, it has already deep-dived into other liquid tokens and crypto startups. 

Even before these announcements, founder Alan Howard had already made personal investments in crypto. He reportedly holds a 25% stake in One River Asset Management and has interests in crypto businesses like Copper. co. and Elwood. As per reports, the former CEO has at least nine investments in crypto businesses. 

Lately, many hedge funds like Tudor Investment Corporation and Third Point are checking the crypto waters. Just last week, Bain Capital Ventures (BCV) filed for a crypto-focused fund called BCV Crypto Fund I, L.P.

Why the increased investments by hedge funds

A PwC 2021 report on global hedge funds specifies the reasons. The primary reason given by most hedge fund managers for including digital assets was “general diversification.” Apart from that, “exposure to a new value creation ecosystem” and its ability to “hedge against inflation” were other reasons for the growing popularity of crypto among hedge fund investments.