Private-Asset Boom Cools as Alt Assets Corner New Billions

Crypto strategies, along with hedge funds, are gaining momentum in the world of alternative investments

- Bloomberg

Fundraising for private equity and credit—once Wall Street's most reliable cash magnets—is slowing, while hedge funds and crypto strategies are gaining momentum in the world of alternative investments.

For years, private markets of all stripes absorbed vast sums of cash, with funds closing in record time and little debate over where the next dollar would go. That grip has loosened over the past year—small wonder, then, that industry executives are pressing for 401(k) access, a campaign that could eventually draw billions from US retirement savings.

For now, fundraising has slumped to its weakest pace in years, hobbled by clogged exits and investors waiting for cash to come back. Private credit is on track for its weakest year since at least 2018, according to data compiled by JPMorgan Chase & Co., with fundraising timelines stretching close to two years, the longest since the financial crisis. Private equity fundraising plunged 35% in the first quarter from a year earlier, according to PitchBook.

By contrast, hedge funds are seeing their biggest inflows in a decade, and crypto—once written off as a busted trade for serious money managers—is pulling in new waves of family office cash and institutional capital.