Last Updated: 13 September 2022
Stone Ridge is discontinuing their bitcoin strategy fund. The fund manager wants to liquidate all assets of the fund around 21 October. This is evident from an application to the Securities and Exchange Commission (SEC).
Stone Ridge Shutting down Bitcoin Futures Fund, Returning Money to Investors https://t.co/cG3AwZoWsF
— GEM HODLERS News & Marketing Co.® 💎 (@TheGemHodlers) September 13, 2022
Shareholders in the fund will receive their compensation in cash. The idea is that every investor will get his or her money back.
The fund began with high hopes in 2019. The goal was clear: buy bitcoin futures. The fund was named ‘NYDIG Bitcoin Startegy Fund’.
There was no real bitcoin involved, as these were contracts backed by US dollars. This allows you to speculate on the price, but you never own bitcoin. This market offers no guarantees for these types of parties either. The price of bitcoin is and remains volatile.
Stone Ridge itself as a company is not stopping bitcoin. Stone Ridge Holdings Group has billions under management and also owns NYDIG. The latter is primarily focused on integrating bitcoin into the traditional system. The subsidiary has hundreds of clients in America. It is no coincidence that NYDIG is estimated to be worth $9 billion.
The bitcoin market is very interesting for fund managers. There are already many financial products on and around BTC, but there seems to be room for more. Bitcoin, as a new market, is interesting for many investors. However, at the moment, interest is not particularly high. The price combined with a troubled world does not make parties want to flee to bitcoin in droves. Let alone a bitcoin fund.
Stone Ridge tried it with futures, but of course you can also ‘just’ buy bitcoin and store it. The largest fund that does that is the Grayscale Bitcoin Trust. With a balance of 643,572 BTC, it is by far the largest bitcoin fund in the world. However, it is almost impossible for others to match this number. Grayscale started hoarding bitcoin back in 2013.