First Cryptocurrency Hedge Fund Approved by UK Regulators

UK regulators are known for have stringent regulations pertaining cryptocurrencies. Prime Factor Capital becomes the first crypto hedge fund to be approved by the regulators as a full scope alternative investment fund manager.

Financial Conduct Authority Approves Prime Factor Capital

In a recent article published by Bloomberg, the Financial Conduct Authority, a UK watchdog approved Prime Factor Capital application to operate as a crypto hedge fund in the country. Following the approval, the hedge fund is expected to obey all the stipulated European regulations.

One of the regulations is that Prime Factor Capital will be allowed to have more than 100 million Euros in assets under its wings of management. Notably, this is the first firm in the new financial industry to get approval to invest in various cryptocurrency assets exclusively.

Speaking during a recent interview, Prime Factor Capital founders stated that focusing on one cryptocurrency asset, even one that is not highly ranked in the market, will help the firm to get ahead of the competition and become an authority in crypto investing.

Adam Grimsley, the Chief Operating Officer at Prime Factor, told the press that most of the existing vehicles of investing in digital currencies are outside the regulators scope and that is a big problem due to reputation issues.

Under the EU regulations, the hedge fund is required to appoint a custodian who will ensure and verify all investors fund’s holdings and returns. The custodian will be independent from the firm and will focus on tasks such as cash flow reconciliation.

The Prime Factor Capital manages funds for not only professionals in various industries such as manufacturing but also institutional investors and high net worth clients such as former employees of Deutsche Bank, Legal & General, Blackrock, and Goldman Sachs.

It seems that the company decisions are based on market analysis and this is a good thing for investors who want to value for money from their investments. The CEO, Nic Niedermowwe, recently published a report on the official website titled “The Fallacy of Uncollateralised Stablecoins.” In the report, he states that uncollateralised stablecoins are a major problem in the industry. The report also goes an extra mile to look at scalability of bitcoin whose price has being surging upwards at an unexpected high rate over the last couple of months.

Closing Remarks

Notably, Prime Factor Capital recently told the press that they were considering running an equity-financing round with a European Fintech investor and Entrepreneur First. Stay tuned for more news about this and other cryptocurrency trends.