Wall Street sees declining private equity enthusiasm, with funds shifting to hedge funds and digital assets
Summary
- Citing a JPMorgan report, it was reported that capital inflows towards hedge funds and digital assets are expanding in Wall Street.
- Conversely, inflows into private equity and private debt have sharply slowed, with prolonged sluggish deal activity and capital recovery delays.
- Bloomberg evaluated that as the environment favoring digital asset investment in the U.S. has formed, regulatory clarity and Circle's IPO have had a positive impact on investor sentiment.
According to analysis, while capital inflows into private equity and private debt markets have slowed in Wall Street, the financial hub of the United States, hedge funds and digital assets (cryptocurrency) are drawing growing attention within the alternative investment landscape.
On the 4th (local time), Bloomberg News, citing a JPMorgan report, stated that $25 billion flowed into hedge funds in the second quarter, marking the highest level since 2014; the digital asset sector also attracted $60 billion by July of this year.
In contrast, private equity fundraising stood at $116 billion in the first quarter, down 35% year-over-year, and private debt also fell to its lowest level since 2018.
Experts noted that as sluggish deal activity and delayed capital recovery persist, investors are showing a preference for strategies that allow for quicker capital deployment. Nikolaos Panigirtzoglou, a JPMorgan analyst, said, "Capital inflows into digital assets and hedge funds are accelerating," while "the private markets are experiencing bottlenecks."
Favorable conditions for digital asset investments within the U.S. have also had an impact. Bloomberg News noted that regulatory clarity—such as the passage of the U.S. stablecoin regulation, the GENIUS Act—and Circle's successful IPO have bolstered investor sentiment.
Uk Jin
wook9629@bloomingbit.ioH3LLO, World! I am Uk Jin.
