Brevan Howard is creating a new division to focus on its investments in cryptocurrencies and digital assets and gain more exposure to the space.
The macro hedge fund’s BH Digital unit will “significantly expand the firm’s involvement” in the sector, Brevan Howard said in a 13 September statement.
It hired Colleen Sullivan, chief executive of blockchain investor CMT Digital, to lead the unit’s private and venture investment activities in crypto. Sullivan will also chair the investment committee of its new strategy, the fund said, focusing on “the highly compelling and disruptive technologies in this class”.
Brevan Howard has already taken stakes in various startups linked to the digital sector and allocated a portion of its Brevan Howard Master Fund to cryptocurrencies.
Co-founder Alan Howard is a strong proponent of such assets, backing companies via One River Asset Management, a crypto-focused firm in which he owns a significant interest. He also owns crypto markets business Elwood Asset Management.
“Brevan Howard’s belief in the huge diversity of opportunities within the digital asset space and the significance of this to long-term macro investors is the reason we are delighted to welcome Colleen to the firm,” said Aron Landy, chief executive officer of the company.
Brevan Howard said it began investing directly in digital assets on behalf of clients earlier this year through the launch of a liquid token, value-oriented fund.
Institutional investors such as Goldman Sachs, Nomura and Morgan Stanley have ploughed into cryptocurrencies since the end of last year, buoyed by rising retail interest. But prices have been volatile. Bitcoin, for example, lost more than half of its 2021 gains in a series of flash crashes earlier this year.
Other asset managers, such as Europe’s largest Amundi, have opted to stay out of the space.
The €1.8tn manager told Financial News in March that it had no plans to launch crypto-linked products, warning that nature and development of cryptocurrencies “will soon become impossible to tolerate by central banks”.
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