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Hedge funds cash in on Trump-fuelled crypto boom

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Hedge funds cash in on Trump-fuelled crypto boom

A clutch of cryptocurrency-focused hedge funds has made a windfall in recent weeks as Donald Trump’s election win fuelled a powerful rally that propelled bitcoin above the $100,000 milestone.

Funds employing crypto strategies posted gains of 46 per cent in November, bringing their year-to-date returns to 76 per cent, according to data provider Hedge Fund Research. The returns have outpaced the broader industry, with the average hedge fund gaining 10 per cent in the first 11 months of this year, HFR said.

Brevan Howard Asset Management and Galaxy Digital, the cryptocurrency investment manager founded by billionaire Mike Novogratz, have been among the biggest winners from the recent surge in digital assets.

Crypto funds’ outsized gains come after Trump’s election victory in November added a fresh jolt of enthusiasm to this year’s rally in bitcoin, the biggest cryptocurrency, which has also sent smaller tokens soaring.

Bitcoin has risen 130 per cent this year to around $100,000, helping push the market value of major crypto tokens up by $1.8tn to $3.5tn, according to the FT Wiltshire Digital Assets Dashboard. The crypto market pulled back from recent highs this week after the Federal Reserve said it would cut rates less than expected next year, hitting risky assets.

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Investors are betting that Trump’s crypto-friendly nominees for top government jobs will contrast with Joe Biden’s administration, which has generally taken a more sceptical approach.

“Trump’s election is great news for digital assets because it’s going to bring more clarity on the regulatory side,” said Damien Miller, managing partner at macro hedge fund MP Alpha Capital. “There will be an environment that is more friendly and collaborative towards bitcoin and blockchain.”

Brevan Howard’s main crypto fund gained 33 per cent in November, and is now up 51 per cent in the first 11 months of the year, according to investors. Brevan Howard, which has $35bn in assets, is one of the biggest hedge fund managers to have a devoted crypto business, which it launched in 2021.

Galaxy’s hedge fund strategy gained 43 per cent in November, and is up 90 per cent in 2024, according to investors. The New York-based group has more than doubled its assets under management in the past two years, to $4.8bn, in part by buying up assets from bankrupt crypto companies.

Galaxy and Brevan Howard declined to comment on their performance.

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The recent surge in digital assets marks a staggering reversal in fortunes for a sector that was mired in a deep crisis beginning in 2022.

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Bitcoin hit a low of around $15,500 when Sam Bankman-Fried’s FTX exchange collapsed in November 2022. Galaxy, which has sought to position itself as a full-service crypto financial services firm, posted a $1bn net loss that year.

The cryptocurrency industry received a fillip in January 2024 when the US Securities and Exchange Commission approved 11 exchange traded bitcoin funds, opening the door to cryptocurrencies for new institutional and retail investors. BlackRock, the world’s biggest asset manager, said last week it sees a “case for including bitcoin in multi-asset portfolios”.

NextGen Digital Venture, a $120mn crypto equity fund, is up 330 per cent from its launch in March 2023 to the end of November, according to investors. It has benefited from positions in some bitcoin ETFs, as well as cryptocurrency exchange platform Coinbase and software provider turned bitcoin investor MicroStrategy.

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“After the bitcoin ETF was approved we felt that crypto stocks would become another opportunity for institutional investors because they already had access to bitcoin,” said Jason Huang, founding partner of NextGen Digital Venture.

Coinbase is up almost 60 per cent since the end of 2023, while MicroStrategy is up more than 400 per cent.

Some macro hedge funds — which trade macroeconomic trends in currencies, commodities, bonds and stocks — have also boosted exposure to digital assets in anticipation of a favourable market environment. MP Alpha Capital’s $20mn global macro hedge fund is up over 30 per cent this year, according to investors.

“We’ve had a good run on digital assets: bitcoin, ethereum and bitcoin miners,” said Miller, referring to firms that complete complex calculations in exchange for tokens. “Over the past 18 months, our whole thesis was around the institutional adoption of digital assets and the macro backdrop of looser monetary policy, a weaker dollar and a liquidity-rich environment.”

Trump has signalled that crypto regulation is among his most pressing priorities, and has named venture capitalist and Elon Musk confidant David Sacks as the White House’s cryptocurrency tsar.

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A change in leadership at the SEC, the top American securities regulator, has also been welcomed by crypto enthusiasts.

Gary Gensler, the current chair who branded crypto a “wild west” rife with unlawfulness and investor risk, will step down when Trump takes office. He had refused to craft rules catered to digital assets, arguing that many tokens are securities and that existing securities law is enough guidance.

Gensler will be replaced by cryptocurrency advocate Paul Atkins.

Still, several managers warned that the surge in bitcoin should cause investors to pause and take stock. Huang at NextGen Digital Venture said that, while he is long-term bullish on bitcoin and crypto, “no asset rises in a straight line without volatility.”

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Waymo called the cops on teen riders, raising privacy concerns

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Waymo called the cops on teen riders, raising privacy concerns

A Waymo robotaxi drives in San Francisco’s North Beach neighborhood this week.

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Police in San Mateo, Calif., posted Monday on social media that they had apprehended a pair of teenagers from a Waymo driverless robotaxi after the company alerted authorities to suspected criminal activity. It’s the latest incident involving video surveillance of passengers and others by autonomous vehicles — raising questions about the limits of privacy in such vehicles.

The Facebook post by the San Mateo County Police said: “Parents do you know where your teens are? @waymo does!”

The 15-year-olds were allegedly drinking alcohol and shooting toy guns from the car, according to the police. They said Waymo’s systems detected behavior that then triggered a safety response, after which the company disabled the vehicle and contacted police.

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Waymo’s cars, equipped with an array of cameras, microphones and other sensors to monitor passengers and other nearby vehicles, are becoming more common in cities across the United States. Experts say the detention of the two teens in San Mateo highlights a potential — but not inevitable — trade-off between privacy and convenience. It also questions the extent to which companies similar to Waymo are required to hand over private data, including audio and video of passengers, in situations where a crime is suspected.

NPR reached out to Waymo, which is owned by Alphabet, the parent company of Google, for comment on the details of the San Mateo incident and how the company responded, but did not hear back. But on its website, the company says that as many as 29 cameras in its autonomous cars provide an all-around view and “are designed with high dynamic range and thermal stability, to see in both daylight and low-light conditions, and tackle more complex environments.”

“There already exist laws that govern duty to report or even duty to protect” for carriers such as Waymo, according to Alessandro Acquisti, a professor of information technology at the MIT Sloan School of Management. “The privacy problems arise when and if driverless carrier companies used such laws or ethical obligations as a pretext for blanket, indiscriminate accumulation of identifiable data for unspecified future purposes.”

That includes not just monitoring people inside the cars, but outside too. Take, for example, a hit-and-run investigation last year in Los Angeles. Media reported that the police inquiry was aided by video captured by a Waymo taxi that had a clear view of the crime. Critics suggested at the time that authorities were using the company’s vehicles as a mobile surveillance platform. And during 2025 protests in Los Angeles against Immigration and Customs Enforcement crackdowns, demonstrators vandalized Waymos, apparently angry that video recorded by the vehicles could be used by police, although there is no evidence that happened.

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Trump fires last members of election commission, inciting fears of midterm ‘chaos’

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Trump fires last members of election commission, inciting fears of midterm ‘chaos’

Donald Trump has terminated the remaining members of the independent, federal commission that assists election administration officials nationwide just a few months before the midterm elections, multiple outlets reported Thursday.

The remaining three commissioners of the four-member bipartisan commission ⁠were forced out on Thursday in different ways. The one Republican appointee resigned and the other ⁠two, Democratic appointees were notified of their terminations via email from ​the White House presidential personnel office.

“On ‌behalf of President ‌Donald J Trump, I am writing to inform you that your position ‌as Commissioner of the Election Assistance Commission is terminated, effective immediately. Thank you for your service,” the email, seen by Reuters, said.

The White House did not immediately respond to a request for comment.

The Election Assistance Commission serves as a “national clearinghouse of information on election ‌administration”, accredits testing laboratories and certifies voting systems, and maintains the national mail-voter registration form developed by the National ​Voter Registration Act of 1993, according to the commission’s website. The terminations follow Trump and top administration officials’ advocacy to change vote-by-mail requirements and investigations into the 2020 election outcome, which Trump lost to Democrat Joe Biden.

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“It is ⁠irresponsible and dangerous that this Administration remains dead set on ​causing chaos for ​our election officials across this ​country,” Arizona secretary of state Adrian Fontes said in a ​Thursday statement. “This ‌move undermines the integrity ​of nonpartisan ​election administration.”

The 2002 law that established the commission, the Help America Vote Act, states the president can appoint replacements to the commission.

It is unclear how Trump will move ahead with the commission.

Reuters contributed reporting

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Former Olympian pleads not guilty in reflecting pool vandalism charges

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Former Olympian pleads not guilty in reflecting pool vandalism charges

Former U.S. Olympian David Hearn (left) walks with his attorney Norman Eisen to speak to reporters and protesters gathered after his arraignment at the Superior Court of the District of Columbia in Washington, D.C. on Thursday.

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Former U.S. Olympic canoeist David Hearn pleaded not guilty to damaging the Lincoln Memorial Reflecting Pool in D.C. Superior Court Thursday morning.

Federal prosecutors charged Hearn with a single count of destruction of property causing more than $1,000 in damage to the pool.

Hearn has previously claimed, which his attorneys repeated during a short press conference outside the court, that he simply touched the water in the pool out of curiosity.

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The Trump administration had just completed a $14 million renovation of the pool.

But shortly after the work finished, peeling paint and algae gathered in the water. The remodel has been largely criticized as a massive failure and waste of taxpayer dollars.

Superior Court Judge Carmen McLean released Hearn on his own recognizance. His next hearing is scheduled for Aug. 5.

Norm Eisen, one of Hearn’s attorneys, spoke to reporters outside of court following the hearing. He said the administration is using Hearn as a “scapegoat … for their own failures.”

“It is not a crime to touch the reflecting pool, to touch water in the United States of America,” he said.

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Prosecutors say there is a host of evidence against Hearn.

This is a developing story.

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