One of the largest hedge funds in the world, Renaissance Technologies, announced that its Medallion Fund division can now make deals with bitcoin futures.
Renaissance Technologies said it would limit its trading activities to contracts entered into on the Chicago Mercantile exchange (CME), but it is not yet known whether the company already has open positions. In addition, Renaissance Technologies informed its investors about the risks associated with investing in bitcoin and tools based on it. The document States:
“Bitcoin is a new and highly speculative asset. Based on this, bitcoin futures are also extremely volatile and investment results can vary greatly over different periods of time. These instruments carry much greater risks and potential losses than more traditional financial instruments. Such investments should be considered as more speculative, and possible losses can be up to a complete loss of capital.”
Note that Medallion Fund is a high-yield hedge Fund, which from 1988 to 2018 brought its investors an average of 40% per annum. In addition, the Fund, which is managed by $10 billion, has grown by 24% since the beginning of the year and in March brought its investors 9.9% profit. However, it is not yet clear how the price of bitcoin will be affected by joining Renaissance Technologies to trade bitcoin futures, since the Fund can enter both long and short positions.