Brevan Howard Asset Management is predicting a potential boom in digital assets similar to what the internet has seen in the past couple of decades and is looking to make “disproportionate returns.”
Though there are a lot of challenges, blockchain and crypto are transformational technologies whose full potential has yet to be tapped, Gautam Sharma, chief executive officer of the digital investment unit of the hedge fund firm, said in Germany.
“We truly believe that this is a very disruptive technology and it can unlock value in many ways,” Sharma said at the FERI hedge funds conference in Bad Homburg near Frankfurt on Thursday. “And we are here to enable our institutional investors to find ways to get access to this space.”
His comments on crypto come in the midst of a US crackdown on the sector, which has seen a $2 trillion crash since 2021, including the chaotic collapse of Sam Bankman-Fried’s FTX exchange last year.
While frequent booms and busts in cryptocurrencies continue to divide opinion, an increasing number of asset managers are joining the fray to offer clients access to digital assets. Brevan Howard already bets a small part of its flagship hedge fund’s capital on them. Its billionaire co-founder Alan Howard allocates his personal money into cryptocurrencies and other companies involved in the sector.
Brevan Howard, best known for macro trading expertise, started BH Digital in September 2021 and has bolstered the business with capital and staff.
It’s super important to get regulatory clarity, Sharma added. Driving the point how these are still early days for these technologies, he played a YouTube video of Bill Gates explaining to David Letterman in the mid-1990s about how the internet is the “next big thing.”
Sharma previously led the principal investments team at Brevan Howard and worked with Alan Howard to oversee his family office’s investments and businesses in crypto, Web 3.0 and digital assets. Before joining Brevan Howard in January 2021, Sharma worked as an operating partner for five years at Steadview Capital Management.
This article was provided by Bloomberg News.