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The Globe and Mail

Hedge fund billionaire makes bet on cryptocurrencies

Coins are displayed next to a Bitcoin ATM in Hong Kong, Dec. 8, 2017.


Hedge fund billionaire Alan Howard made sizable personal investments in cryptocurrencies last year and plans to put more of his own money into digital assets and the blockchain technology behind them, according to people with knowledge of the matter.

Other partners at the hedge fund firm he co-founded, Brevan Howard Asset Management, have independently made similar investments, the people said, asking not to be named because the information isn't public. The investments are separate from the $9.1 billion hedge fund firm, and Brevan Howard does not trade cryptocurrencies, said the people.

Spokesmen for Howard and his company declined to comment on his trades.

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Howard, 54, has already hired at least one person to work for him on initiatives in digital assets and plans to hire more. He could make private-equity style investments in blockchain companies and may participate in initial coin offerings, said the people.

Howard's interest in cryptocurrencies contrasts with the skepticism or hostility of many luminaries of finance, from Jamie Dimon to Warren Buffett. Bitcoin's whipsaw ride over the past six months has thrust the risks of investing in one of the wildest and least-regulated corners of finance into the spotlight.

Cryptocurrencies do have some big-name enthusiasts, including former macro fund manager Mike Novogratz and billionaire investors Mark Cuban and Peter Thiel.

They grabbed mainstream attention in 2017 as Bitcoin, the best-known cryptocurrency, gained an eye-popping 1,400 percent and Bitcoin futures began trading on regulated exchanges. The explosive growth, and subsequent 42 percent decline since the start of 2018, helped prompt scrutiny from regulators around the globe.

Brevan Howard's flagship macro hedge fund recorded its worst ever annual performance last year. Like some other hedge funds betting on economic trends in developed markets, a lack of volatility amid years of central-bank stimulus made it difficult to make money.

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