The passive fund managed by California-based Bitwise Asset Management is outpacing bitcoin.

The fund is up more than 50% since its inception and now has more than 500 LPs.

Bitwise Asset Management is off to a strong start.

The firm's HODL fund, which is made up of ten digital assets and weighted by market capitalization, is up 51% since its inception on November 22, a person familiar with the numbers said. By comparison, bitcoin, the largest cryptocurrency by market capitalization, is up approximately 13.6% over the same period of time, according to data from CoinMarketCap.

The fund now has more than 500 LPs, according to the person, including family offices and other accredited investors. Investors are required to invest at least $10,000.

Since Bitwise launched the fund, Coinbase has announced its intention to enter the cryptocurrency index business with its own fund. The so-called Coinbase Index Fund will give investors access to the four cryptocurrencies listed on Coinbase's GDAX exchange.

Matt Hougan, a 15-year-long veteran of the exchange-traded fund industry, recently joined Bitwise as VP of research and development, Business Insider previously reported.

Bitcoin soared close to $20,000 a coin at the end of 2017. But it has been under pressure since the beginning of 2018, fueled by concerns of a regulatory crackdown in the US and Asia. On top of that, a bitcoin exchange-traded fund, which many thought would help pour retail money into the cryptocurrency, appears to be off the table for at least the first-half of the year.

Still, the number of cryptocurrency-focused hedge funds continues to rise, according to a report by Reuters.

The number of such funds reached a record of 226 funds, up from just 55 at the end of August, financial-technology analytics provider Autonomous NEXT estimates.

"While the softer prices of crypto-assets does create a more difficult environment for investors, I do not think it will pause the influx of funds and other financial institutions building products in the space," Lex Sokolin, a partner at Autonomous NEXT, told Reuters.