Annex’s OD Kobo Says Two-Thirds of Crypto Hedge Funds Will Fail
- Crypto Heavyweight at the Blockchain Conference
- Kobo blames the difficult global macro environment
OD Kobo, is the former co-founder of PIR Equities, the London-based private equity firm that in 2018 became one of the first institutional investors to enter the crypto space with a $50 million investment in Bitcoin (when it was $ 6,938) and Ethereum (at $283), says that most crypto hedge funds will not survive this crypto winter. In 2020, Kobo founded Annex Capital, a digital asset investment firm, with stakes in various projects. He is an active investor in the space and was recently ranked in the top 50 richest in crypto.
At the recent Blockchain Hub Davos, Kobo was interviewed and said that he believes two-thirds of hedge funds investing in crypto will fail due to the current inner-city market and blames the challenging global macro environment for the current down cycle.
“Trading volume will drop, hedge funds will have to restructure,” Kobo said. “There are so many new crypto hedge funds it is overwhelming. My estimate is that two-thirds will go bankrupt, not everyone is cut out for that. He added: “Crypto investors are a different breed of investor, you can’t be at Goldman one day and then decide to open a crypto hedge fund the next day, with the intense volatility in the crypto space, I don’t see the majority of cryptocurrency hedge fund holdings.
Kobo cited the digital asset market’s reaction to the Federal Reserve’s removal of stimulus as the reason for the drop in token prices over the past six months. Bitcoin is down more than 50% from all-time highs hit in November, but Kobo is here for the long haul.
Kobo commented on the recent collapse of the Terra blockchain saying that the coin’s collapse has shaken confidence in the decentralized finance and cryptocurrency space adding, “Fortunately, I never touched Terra or UST. Algorithmic stablecoin never convinced me. I count on USDC for a stable coin and I think the future of Ethereum is much more interesting.”
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