Founder of Morgan Creek Digital predicts closure of cryptocurrency hedge funds

</span>src=&#8221;/wp-content/uploads/2019/10/adf95155eb9777eecd2196d45cedcf7f.jpg&#8221; alt=&#8221;The founder of Morgan Creek Digital predicts the closure of cryptocurrency hedge funds&#8221; /></p>

Founder of Morgan Creek Digital venture capital firmAnthony Pompliano predicts the closure of cryptocurrency hedge funds. Pompliano believes that the situation in the digital asset market will deteriorate, and only after that a bearish trend will reverse.

According to Pompliano, cryptocurrency hedge fundsclosed for 2 main reasons: firstly, fund managers will stop making profits, and secondly, the US Securities and Exchange Commission (SEC) will tighten its policy in relation to ICO projects.

Fund managers receive an average of 20% of incomewith customer investment. In 2018, the Bitcoin exchange rate fell almost 4 times, so there can be no talk of any profit from cryptocurrency hedge funds. From this we can make a very sad conclusion: managers will have to work for free or quit.

SEC recently fined Paragon startup blockchainand Airfox for $ 250,000. The commission also began checking the activities of several ICO projects, if the SEC penalizes a lot of crypto companies, some of them will have to declare bankruptcy. This will have a negative impact on hedge funds, as the rate of coins sold during the ICO will drop to almost zero.

But not everything is as sad as it may seemfirst glance. Pompliano believes that the bearish trend will contribute to the recovery of the cryptocurrency market. “Tourists” will leave it, their place will be taken by professionals and blockchain startups with talented employees. Hedge funds will close for several months, however, when the panic, fear and uncertainty subsides, new funds will be opened, with new names, but with the same managers.