July 15, 2024

Hypersphere Unveils $130 Million Atlas Fund, Adopting Wall Street Strategies for Crypto Investments


Cryptocurrency investment firm Hypersphere has announced the launch of its new fund, Atlas, which boasts $130 million in assets under management (AUM). This fund aims to leverage Wall Street-style strategies to generate returns from crypto assets, according to a statement released on Wednesday.

Launched in stealth mode in January and funded from Hypersphere’s balance sheet, the Atlas fund is staffed by former employees of high-frequency trading firm Millennium and hedge fund Bridgewater. These seasoned professionals are expected to bring their expertise in sophisticated trading strategies to the burgeoning crypto market.

Hypersphere plans to use the multimanager approach, a strategy utilized by Millennium and Bridgewater, to offer investors niche trading strategies while minimizing volatility. The Atlas fund is designed as an open-ended liquid fund, allowing investors to enter and exit positions quickly.

Jack Platts, founder of Hypersphere, described Atlas as “two bets in one.” The first bet is on offering a diversified set of trading strategies, while the second focuses on finding compelling opportunities within the crypto markets. Platts highlighted the significant difference between traditional trading and digital assets trading: the ability to exit quickly. This capability is essential for high-frequency trading (HFT) strategies.

For Atlas to succeed, it will need to utilize centralized exchanges that can support HFT strategies. While institutional-specific exchanges exist, they are generally not equipped to handle the rapid capital movement required by hedge funds employing HFT. This means platforms like Coinbase may be crucial for Atlas’s operations. However, the willingness of crypto exchanges to accommodate HFT, which can increase market volatility, remains a pivotal question.

The introduction of HFT to the crypto markets could bring both increased volatility and liquidity. For Bitcoin investors, this raises a crucial question: Is the potential for greater volatility a worthwhile trade-off for the added liquidity?

The concept behind Atlas is promising, but its success hinges on whether the necessary infrastructure and willingness to support HFT are present in the crypto market. As Hypersphere moves forward with this innovative approach, the industry will be watching closely to see how these strategies unfold and impact the broader cryptocurrency landscape.

Terry Jones
Digital Assets Desk

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