- Neural Capital, a San Francisco-based cryptocurrency hedge fund, is winding up after losing half its investors’ money
- One of its two fund managers quit in 2018 after an alleged falling out
- Crypto hedge funds have been collapsing like cards recently
Neural Capital, a San Francisco-based cryptocurrency hedge fund established in 2017, has been forced to close after losing half its investors’ money. According to Coindesk, the fund is in the process of returning what money is left to its investors following liquidating of its cryptocurrency assets in December last year, with some money still stuck in escrow. Neural Capital follows a trend of increasing cryptocurrency hedge fund collapses since 2017, which is particularly ironic given the buoyant conditions currently surrounding the markets.
Neural Capital Loses Millions
Founded during the crypto gold rush of 2017, by 2019 Neural Capital was managing over $13 million from over 40 investors, with some depositing upwards of over $250,000. The 2018-2019 bear market seems to have been particularly bad for the cryptocurrency hedge fund however, and in December 2019 it withdrew its registration with the U.S. Securities and Exchange Commission. More recently it has stopped submitting obligatory filings to the state of California and the SEC, suggesting that the company is winding down its operations.
Cryptocurrency Hedge Fund Collapses Continue
Coindesk’s sources claim that the fund managers had a falling out in mid 2018 which resulted in one of them, Christopher Keshian, leaving the company. He may have seen the writing on the wall as things seem to have gone from bad to worse for Neural Capital, resulting in them losing half of their investors’ money and seemingly shutting up shop as a result.
Neural Capital is far from the only cryptocurrency hedge fund to close its doors since the 2017 bull market. The UK’s first regulated cryptocurrency hedge fund, Prime Factor Capital, closed its doors two weeks ago after failing to attract enough investors, while a New York-based cryptocurrency hedge fund, Tetras, was shuttered just last week following a 75% loss in its three-year existence. March’s Bitcoin collapse also did for Adaptive Capital, who suffered “infrastructural inefficiencies” during the crash and was forced to close with huge losses.
