Cryptocurrency is a unique investment tool but not everyone has learned how to work with it yet. You can invest in cryptocurrencies by transferring your assets in trust management to professionals. Therefore, special crypto funds were created. Now we will talk about them.
Cryptocurrency funds provide private investors with services for trading and investing in digital currencies. Thus, it is an analog of investment funds, although its field of activity is the cryptocurrency market.
Funds offer potential investors cooperation, thanks to which professionals will dispose of investment capital. A team of experts will conduct operations with digital currencies to get maximum profit in the shortest time possible. Of course, their services are not free, as crypto funds charge a commission fee from the profits, while some of them – from investment capital.
The crypto fund team is obliged to form an investment portfolio, constantly look for potential earning opportunities, competently build a management strategy, as well as to conduct ongoing analysis and risk assessment.
There are several categories of crypto funds:
* Funds organized on the principle of venture capital that invest in projects in the field of blockchain technologies.
* Funds that invest only in startups developed within the framework of ICO.
* Crypto funds operating on the principle of hedge funds that do not work with startups, but invest in cryptocurrencies, regardless of their popularity and novelty. It means that, unlike venture funds, where the product plays the main role, the main purpose of a hedge fund is the prospect of a token in the market. In cryptocurrency hedge funds that deal only with cryptocurrency trading, only cryptocurrency trading determines the profitability of the fund.
* Some funds operate on the principle of mutual funds, which means that they offer the investor a share in the company.
An interesting example of the organization of a new generation fund is the ECRO fund created by the Edinarcoin company.
ECRO fund works on the principle of a mutual tokenized fund. Investors buy domestic currency, acquire a share of the fund and are entitled to a part of the income, in proportion to their investment.
The cryptocurrency market is very volatile, due to which it is able to bring in more revenue than the stock market, however, there are much more risks in it.
Therefore, ECRO fund is going to diversify investments and distribute the investment portfolio between cryptocurrencies and the real economy thereby making the token fund more resistant to fluctuations and daily changes in the cryptocurrency market.
In addition to investing in startups, blockchain projects and ICO, the fund will invest in energy, hotel and restaurant business, as well as real estate around the world.
This project portfolio of the ECRO fund, based on the Edinarcoin blockchain, further enhances the liquidity and stability of Edinarcoin itself.
Earlier, crypto funds brought excellent profits only thanks to a well-formed and professional management portfolio. Now, a truly deep analysis of promising projects is required of crypto funds, as well as investments outside the framework of the cryptosphere, which could bring profit to investors.
For beginners, cryptocurrency investment funds are a chance to invest with minimal risks and minimal investments (as the entry threshold can be very low), for investors with experience it is an opportunity to reduce the time costs of making a profit.