How Blockchain Technology Is Revolutionizing the Hedge Funds and Private Investments

in #blockchain7 years ago

Innovations in blockchain technology are fast proliferating the hedge funds and private funds industries. The technology is playing a key role in securing the crypto assets, like Bitcoin and other ICO token investments of the traders. Hedge fund managers of late have started embracing the blockchain technology and smart contracts to facilitate investments and process optimization in their business model for expansion.

Achieving synergy

While some funds simply focus on the trading of Bitcoin and other altcoins like Ethereum, Zcash, Dash and Litecoin, some others acquire companies that use blockchain technology to achieve synergy with their other portfolio companies. Some crypto hedge funds attain automation by using cryptocurrencies as incentives to facilitate investment analysis efficiencies for use by the data scientists.

Improved data security and transactions

Hedge fund managers are using blockchain technology not only to secure the crypto assets and improve investment functions, but also to meet the growth expectations of the clients. By automatically recording all transactions and documenting the related transactions, blockchain technology helps reduce the otherwise significant costs associated with human errors in maintaining investment fund data and records. It improves data security as the transactions are recorded in an immutable database with valid details of transactions.

Improved efficiency of funds

The technology provides the users fully transparent data on marketplaces. It significantly reduces the need of information exchange among the parties as the transactions are transparent and accurately recorded. The technology allows for the simplification of transactions, saves the expenses on labor-intensive data maintenance, and improves the efficiency of the private investment funds.

Safe, secure and very low cost transactions

Hedge funds utilizing the prowess of blockchain technology quite often combine the benefits of the emerging technologies like Artificial Intelligence and Big Data to obtain synergy in the ecosystem. The technology has the potential to effectively restructure hedge funds and traditional banking systems. Legacy systems of traditional banking are time consuming and expensive, and prone to human oversights. As the technology is transparent, self-authenticating, verifiable and self-enforcing, the transactions can be effected securely and safely with near zero transaction costs.

Diversification of funds

Diversification of investment portfolio, as offered by HedgeConnect, the trusted hedge fund is key element to secure the investments of the people from the vicissitudes of equity markets and stock investments. Although digital currencies can be more volatile than the traditional stocks, these can be effectively used to hedge against the traditional investments.

Multiple investment options for traders

Traditionally, investors had to purchase Bitcoin or some other digital asset, hold it in an exchange, and had to diversify the same by investing in multiple cryptocurrencies. However, thanks to the adoption of blockchain into private investment funds, HedgeConnect now offers the investors option for diversified investments in multiple altcoins and fiat currencies, without the risk of making investments in the virtual currency itself, or the underlying organization behind a protocol.

Incentivized innovations in digital asset investments

Rather than making big investment in a particular crypto currency, HedgeConnect makes use of a diversified and asymmetric investment strategy by making large investments in multiple digital assets. This strategy, besides securing the investors’ funds from the volatility of the crypto markets, also helps enhance the value of the fund during downswings. This way, fund managers at HedgeConnect are able to meet the growth expectation of the investors. The funds utilizing the innovative blockchain technology can gain substantial operational efficiency and cost savings. They are also in the advantageous position of effectively diversifying their portfolio holdings. When the long-term benefits of the technology exceed the implementation costs, the fund managers are incentivized to start the innovation process themselves.

Disintermediation of fund management

Although the use of blockchain technology in hedge funding is still in its infancy, the innovation benefits for the investors promise to have lasting effects on the industry. The use of blockchain technology by HedgeConnect, due to its very structural characteristics is disruptive for the existing financial transactions. Begin the early adopter of the blockchain, HedgeConnect is strategically positioned to contribute to the disintermediation and imbedding of the blcokchain infrastructure into financial ecosystem.

HedgeConnect also offers a lending platform that allows the investors to lend their money to the fund to secure higher returns.

Contact HedgeConnect.co to get further details about its various attractive offerings.

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