The article discusses the growth of crypto funds and their performance in the market. It explains that investors can now easily get exposure to the cryptocurrency market through professionally managed crypto funds. The average asset under management of these funds is over $150 million, and they aim to outperform the market through market timing. Several academic studies have examined the performance of crypto funds, with mixed results. Some studies show that these funds generate higher returns and alphas compared to passive benchmarks and conventional risk factors, indicating that they outperform the market. However, other studies suggest that only a few funds have superior skills, and the choice of performance measure affects the rank order of funds. A study highlights that managers with previous hedge fund experience achieve significant returns, while those with a crypto/blockchain background do not perform better. Overall, the literature suggests that investing in crypto funds can be beneficial, but the future performance of these funds remains uncertain with the introduction of ETFs and other market developments.



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