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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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Trump Says Israel and Lebanon Agree to Extend Cease-Fire by Three Weeks

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Trump Says Israel and Lebanon Agree to Extend Cease-Fire by Three Weeks

President Trump announced a three-week extension of a cease-fire between Israel and Lebanon that had been set to expire in a few days, after hosting a meeting between Israeli and Lebanese diplomats at the White House on Thursday.

Hezbollah, the Iranian-backed militant group that has been attacking Israel from southern Lebanon, did not have representatives at the meeting and did not immediately comment on the announcement. The prime minister of Israel and the president of Lebanon also did not comment.

A successful peace agreement would hinge upon Hezbollah halting attacks, which Lebanon’s government has little power to enforce because it does not control the militia. Lebanon’s military has mostly stayed out of the fighting and is not at war with Israel.

The cease-fire, which was scheduled to end on April 26, would last until May 17 if it takes effect as Mr. Trump described it. Before the cease-fire was brokered last week, nearly 2,300 people were killed in Lebanon and 13 in Israel. Since then, the number of Israeli airstrikes and Hezbollah attacks have been dramatically reduced, though the two sides have continued exchanging fire.

The Lebanese Ambassador to the United States, Nada Hamadeh, credited Mr. Trump for extending the cease-fire, saying that “with your help and support, we can make Lebanon great again.” Mr. Trump replied, “I like that phrase, it’s a good phrase.”

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Asked about the potential of a lasting peace agreement between Israel and Lebanon, Mr. Trump said that “I think there’s a great chance. They are friends about the same things and they are enemies on the same things.”

But Lebanon and Israel have periodically been at war since Israel’s founding in 1948. Israel has invaded Lebanon for the fifth time since 1978, incursions that have destabilized the country and the delicate balance of power between Muslim, Christian and Druze communities.

In the hours before the president’s announcement on social media, Israel and Hezbollah were trading attacks in southern Lebanon, testing the existing cease-fire.

Mr. Trump said the meeting at the White House had been attended by high-ranking U.S. officials, including Vice President JD Vance, Secretary of State Marco Rubio and the U.S. ambassadors to Israel and Lebanon.

Earlier on Thursday, an Israeli strike near the southern Lebanese city of Nabatieh killed three people, according to Lebanon’s health ministry. Hezbollah claimed three separate attacks on Israeli troops who are occupying southern Lebanon, though none were wounded or killed.

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Hezbollah set off the latest round of fighting last month by attacking Israel soon after the start of the U.S.-Israeli bombing campaign in Iran. Israel responded to Hezbollah’s attacks by launching airstrikes across Lebanon and widening a ground invasion of the country’s south.

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U.S. soldier charged with suspected Polymarket insider trading over Maduro raid

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U.S. soldier charged with suspected Polymarket insider trading over Maduro raid

Smoke rises from Port of La Guaira in Venezuela on Jan. 3, 2026 after U.S. forces seized the country’s president, Nicolas Maduro and his wife.

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Federal prosecutors on Thursday unsealed an indictment against a U.S. Army soldier, accusing him of using his insider knowledge of the clandestine military operation to capture Venezuelan leader Nicolás Maduro in January to reap more than $400,000 in profits on the popular prediction market site Polymarket.

The Justice Department says Gannon Ken Van Dyke, 38, who was stationed at Fort Bragg, in North Carolina, was part of the team that planned and carried out the predawn raid in Caracas earlier this year that resulted in the apprehension of Maduro.

The Department of Justice and the Commodity Futures Trading Commission filed the actions against Van Dyke, the first time U.S. officials have leveled criminal charges against someone over prediction market wagers.

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According to the indictment, Van Dyke now faces counts of wire fraud, commodities fraud, misusing non-public government information and other charges.

Trading under numerous usernames including “Burdensome-Mix,” Van Dyke allegedly traded about $32,000 on the arrest of Maduro, resulting in profits exceeding $400,000.

“Prediction markets are not a haven for using misappropriated confidential or classified information for personal gain,” said U.S. Attorney Jay Clayton for the Southern District of New York. “Those entrusted to safeguard our nation’s secrets have a duty to protect them and our armed service members, and not to use that information for personal financial gain.”

Van Dyke’s defense lawyer is not yet publicly known. Polymarket did not return a request for comment.

The charges against Van Dyke come at a sensitive time for the prediction market industry, which has been growing exponentially, despite calls in Washington and among state leaders for the sites to be reined in.

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Van Dyke is the first to be charged in the U.S. for suspected Polymarket insider trading, but Israeli authorities in February arrested several people and charged two on suspicion of using classified information to place bets about military operations in Iran on Polymarket.

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Senate Adopts GOP Budget, Laying the Groundwork to Fund ICE and Reopen DHS

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Senate Adopts GOP Budget, Laying the Groundwork to Fund ICE and Reopen DHS

The Senate early Thursday morning adopted a Republican budget blueprint that would pave the way for a $70 billion increase for immigration enforcement and the eventual reopening of the Department of Homeland Security.

Republicans pushed through the plan on a nearly party-line vote of 50 to 48. It came after an overnight marathon of rapid-fire votes, known as a vote-a-rama, in which the G.O.P. beat back a series of Democratic proposals aimed at addressing the high cost of health care, housing, food and energy. The debate put the two parties’ dueling messages on vivid display six months before the midterm elections.

Republicans, who are using the budget plan to lay the groundwork to eventually push through a filibuster-proof bill providing a multiyear funding stream for President Trump’s immigration crackdown, used the all-night session to highlight their hard-line stance on border security, seeking to portray Democrats as unwilling to safeguard the country.

Democrats tried and failed to add a series of changes aimed at addressing cost-of-living issues, seizing the opportunity to hammer Republicans as out of touch with and unwilling to act on the concerns of everyday Americans.

Here’s what to know about the budget plan and the nocturnal ritual senators engaged in before adopting it.

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The budget blueprint is a crucial piece of Republicans’ plan to fund the Department of Homeland Security and end a shutdown that has lasted for more than two months. After Democrats refused to fund immigration enforcement without new restrictions on agents’ tactics and conduct, the G.O.P. struck a deal with them to pass a spending bill that would fund everything but ICE and the Border Patrol. Republicans said they would fund those agencies through a special budget bill that Democrats could not block.

“We can fix this with Republican votes, and we will,” said Senator Lindsey Graham, Republican of South Carolina and the Budget Committee chairman. “Every Democrat has opposed money for the Border Patrol and ICE at a time of great peril.”

In resorting to a new budget blueprint, Republicans laid the groundwork to deny Democrats a chance to stop the immigration enforcement funding. But they also submitted themselves to a vote-a-rama, in which any senator can propose unlimited changes to such a measure before it is adopted.

The budget measure now goes to the House, which must adopt it before lawmakers in both chambers can draft the legislation funding immigration enforcement. That bill will provide yet another opportunity for a vote-a-rama even closer to the November election.

Democrats took to the floor to criticize Republicans for supercharging funding for federal immigration enforcement rather than moving legislation that would address Americans’ concerns over affordability.

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“This is what Republicans are fighting for,” said Senator Chuck Schumer, Democrat of New York and the Democratic leader. “To maintain two unchecked rogue agencies that are dreaded in all corners of this country instead of reducing your health care costs, your housing costs, your grocery costs, your gas costs.”

Democrats offered a host of amendments along those lines, all of which were defeated by Republicans — and that was the point. The proposals were meant to put the G.O.P. in a tough political spot, showcasing their opposition to helping Americans afford high living costs. Fewer than a handful of G.O.P. senators crossed party lines to support them.

The G.O.P. thwarted an effort by Mr. Schumer to require that the budget measure lower out-of-pocket health care costs for Americans. Two Republicans who are up for re-election this year, Senators Susan Collins of Maine and Dan Sullivan of Alaska, voted with Democrats, but the proposal was still defeated.

Republicans also squelched a move by Senator Ben Ray Lujan, Democrat of New Mexico, to create a fund that would lower grocery costs and reverse cuts to food aid programs that Republicans enacted last year. Ms. Collins and Mr. Sullivan again joined Democrats.

Also defeated by the G.O.P.: a proposal by Senator John Hickenlooper, Democrat of Colorado, to address rising consumer prices brought on by Mr. Trump’s tariffs and the war in Iran; one by Senator Edward J. Markey, Democrat of Massachusetts, to require the budget measure to address rising electricity prices, and another by Mr. Markey to create a fund to bring down housing costs.

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Senator Jon Ossoff, a Democrat who is up for re-election in Georgia, also sought to add language requiring the budget plan to address health insurance companies denying or delaying access to care, but that, too was blocked by Republicans.

While Republicans had fewer proposals for changes to their own budget plan, they also sought to offer measures that would underscore their aggressive stance on immigration enforcement and dare Democrats to vote against them.

Mr. Graham offered an amendment to allocate funds toward a deficit-neutral reserve fund relating to the apprehension and deportation of adult immigrants convicted of rape, murder, or sexual abuse of a minor after illegally entering the United States. It passed unanimously.

Senator Josh Hawley, Republican of Missouri, sought to bar Medicaid payments to Planned Parenthood, which provides abortion and other services, and criticized the organization for providing transgender care to minors. Senator John Kennedy, Republican of Louisiana, also attempted to tack on the G.O.P. voter identification bill, known as the SAVE America Act. Both proposals were blocked when Democrats, joined by a few Republicans, voted to strike them as unrelated to the budget plan.

The Republicans who crossed party lines to oppose their own party’s proposals for new voting requirements were Ms. Collins along with Senators Mitch McConnell of Kentucky, Lisa Murkowski of Alaska and Thom Tillis of North Carolina.

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Ms. Collins and Ms. Murkowski also opposed the effort to block payments to Planned Parenthood.

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