Louis Goss
Fri, January 31, 2025
Hedge funds have bet billions of dollars against Donald Trump’s America amid fears of a market crash.
Data from Goldman Sachs show there has been a surge in “short” bets against US stocks, meaning traders will make money when they fall in value, in a sign of growing concerns about the market.
In January, investors have placed 10 times more bets on US stocks falling than equivalent bets that shares in leading American companies would rise, the investment bank said. It suggests many traders are sitting on huge profits from the chaos earlier this week, when shares in big tech stocks slumped following a panic over the success of rival Chinese AI DeepSeek.
The increase in short bets marks a major turnaround in sentiment from November, when hedge funds piled into long bets on US stocks, predicting they would rise.
Hedge funds ploughed billions into so-called “Trump trades” in the immediate wake of the US election in November, on expectations the new president’s tax cuts and tariff policies would boost America’s economy.
A surge in clients giving their money to the funds in the wake of Mr Trump’s victory helped lift the amount of money managed by the industry to all-time highs of over $4.5 trillion (£3.6 trillion).
Mr Trump has also received significant support from high profile fund chiefs, including Bill Ackman, who has become a major opponent to diversity, equity and inclusion (DEI) initiatives since the Oct 7 2023 attacks on Israel.
In the run-up to the elections, Mr Ackman, who founded Pershing Square Capital Management in 2004, publicly endorsed Mr Trump. The billionaire hedge fund manager had previously donated millions to Super PAC organisations supportive of the Democratic Party.
Mr Trump subsequently appointed hedge fund manager and Republican Party donor Scott Bessent as his treasury secretary. Mr Bessent started his career at George Soros’s hedge fund in the 1990s before launching his own investment fund Key Square Group in 2015.
Ken Griffin, who founded Citadel in 1990, later also came out in support of Mr Trump in December, having held back from financially supporting the Republican candidate’s campaign. Mr Griffin, who has donated millions to various Republican candidates and political, had earlier described Mr Trump as a “three-time loser.”
Speaking at the DealBook summit in December, Mr Griffin said Trump’s victory posed an opportunity to end the “regulatory and litigation-induced paralysis” of the Biden era and “bring America back to a nation of principles, of strength, of prosperity and possibility,” according to Politico.
‘Uncertainties persist about Trump’
Individual hedge funds do not typically make their positions public, so it is not known if any of the above are shorting the US market.
Bruno Schneller, managing partner at asset manager Erlen Capital Management, said the increase in short bets against US stocks likely reflect concerns about “macroeconomic uncertainty.”
Analysts at Swiss bank UBS, led by Karim Cherif, head of alternative investments, said: “As the new year unfolds, uncertainties persist regarding Trump’s policies, the global economic trajectory, and central bank actions.”
Separately, Elliott Management, which controls more than $70bn worth of investments, this week warned that Mr Trump’s presidency was fuelling speculative bubbles in markets that threaten to “wreak havoc” if markets crash, according to the Financial Times.
The concerns come as the “magnificent seven” tech companies – Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia and Tesla – have seen their stock prices surge over the past two years on excitement surrounding artificial intelligence (AI).
Investors have become increasingly concerned about over-investment in leading technology companies. The launch of DeepSeek’s new chatbot earlier this month has heightened those concerns.
This week, concerns surrounding DeepSeek led a major sell-off of stocks in top American tech companies, including computer chip maker Nvidia, which saw almost $600bn knocked off its valuation.
DeepSeek itself is owned by Chinese hedge fund High Flyer, which uses algorithmic trading techniques to place bets on market movements. Liang Wenfeng, High Flyer’s chief executive, is also DeepSeek’s chief executive.
Top hedge fund Elliott Management fears Trump is inflating a crypto bubble that faces 'inevitable' collapse, report says
Filip De Mott
Fri, January 31, 2025
Filip De Mott
Fri, January 31, 2025
Business Insider
Getty Images; Jenny Chang-Rodriguez/BI
Elliott Management said a crypto collapse could "wreak havoc in ways we cannot yet anticipate."
The White House's boosting of crypto is fueling speculation, it said in a letter.
The letter questioned why the administration would embrace alternative reserve assets that threaten the dollar's role.
Cryptocurrencies are riding a speculative mania bound for a dramatic collapse, and the Trump administration is only helping inflate the bubble further, Elliott Management wrote in a letter seen by the Financial Times.
The letter from the $70 billion hedge fund puts it at odds with Washington's embrace of crypto, warning of potential consequences to market stability and the dominance of the US dollar.
According to the letter, the current market landscape is unlike any other. Investors are "acting like a crowd of sports bettors," with widespread speculation evident in the AI investing frenzy and elevated stock valuations.
Crypto is at the heart of this risk-on surge, Elliott wrote, with speculators encouraged by the industry's deepening relationship with the White House. Since Donald Trump's inauguration, the president has installed industry-friendly regulatory heads and signed an executive order promoting digital assets.
Trump's campaign promises go even further, and investors are gearing up for more policies to come this year. Bitcoin has rallied 38% since Election Day, while some altcoins have soared much higher.
Despite the surge in value, these assets have "no substance," Elliott said. The hedge fund is bracing for the sector's "inevitable collapse," which "could wreak havoc in ways we cannot yet anticipate."
The letter also highlighted the greenback's dominance as a global reserve currency, and questioned the idea that Washington should turn toward alternative reserve assets. After all, other countries are already working to diversify away from the dollar.
This effectively amounts to a rejection of the national bitcoin reserve, a policy recommendation that would direct the government to buy and hold the flagship token as a hedge against inflation.
Elliott Management did not immediately respond to Business Insider's request for comment.
The fund's founder, Paul Singer, has been critical of crypto for years. In 2018, he called the assets "one of the most brilliant scams in history."
The firm's outlook contrasts starkly with Wall Street's rising enthusiasm for digital assets. While some, such as billionaire investor David Einhorn, also regard the crypto rally with skepticism, institutional demand for digital assets has been gaining more and more traction.
According to Standard Chartered, this should help push bitcoin toward $200,000 by the end of the year. Other altcoins are also projected to gain, especially if Trump policies unleash a meme coin bull run.
Elliott Management said a crypto collapse could "wreak havoc in ways we cannot yet anticipate."
The White House's boosting of crypto is fueling speculation, it said in a letter.
The letter questioned why the administration would embrace alternative reserve assets that threaten the dollar's role.
Cryptocurrencies are riding a speculative mania bound for a dramatic collapse, and the Trump administration is only helping inflate the bubble further, Elliott Management wrote in a letter seen by the Financial Times.
The letter from the $70 billion hedge fund puts it at odds with Washington's embrace of crypto, warning of potential consequences to market stability and the dominance of the US dollar.
According to the letter, the current market landscape is unlike any other. Investors are "acting like a crowd of sports bettors," with widespread speculation evident in the AI investing frenzy and elevated stock valuations.
Crypto is at the heart of this risk-on surge, Elliott wrote, with speculators encouraged by the industry's deepening relationship with the White House. Since Donald Trump's inauguration, the president has installed industry-friendly regulatory heads and signed an executive order promoting digital assets.
Trump's campaign promises go even further, and investors are gearing up for more policies to come this year. Bitcoin has rallied 38% since Election Day, while some altcoins have soared much higher.
Despite the surge in value, these assets have "no substance," Elliott said. The hedge fund is bracing for the sector's "inevitable collapse," which "could wreak havoc in ways we cannot yet anticipate."
The letter also highlighted the greenback's dominance as a global reserve currency, and questioned the idea that Washington should turn toward alternative reserve assets. After all, other countries are already working to diversify away from the dollar.
This effectively amounts to a rejection of the national bitcoin reserve, a policy recommendation that would direct the government to buy and hold the flagship token as a hedge against inflation.
Elliott Management did not immediately respond to Business Insider's request for comment.
The fund's founder, Paul Singer, has been critical of crypto for years. In 2018, he called the assets "one of the most brilliant scams in history."
The firm's outlook contrasts starkly with Wall Street's rising enthusiasm for digital assets. While some, such as billionaire investor David Einhorn, also regard the crypto rally with skepticism, institutional demand for digital assets has been gaining more and more traction.
According to Standard Chartered, this should help push bitcoin toward $200,000 by the end of the year. Other altcoins are also projected to gain, especially if Trump policies unleash a meme coin bull run.
How Does Pete Hegseth Feel About Bitcoin? His Financial Filings Reveal The Answer
AJ Fabino
Sun, February 2, 2025
AJ Fabino
Sun, February 2, 2025
BENZINGA
New Defense Secretary Pete Hegseth brings cryptocurrency holdings to the Pentagon’s top post, with financial disclosures showing he owns between $5,000 and $15,000 in Bitcoin amid his broader support for digital assets.
“Look at [Donald] Trump, making bitcoin great again,” Hegseth said during a Fox News segment in November after Bitcoin initially surged past $80,000. “All it took was signaling to that market that they weren’t going to be overregulated. Trump embraced them.”
The Senate confirmed Hegseth as defense secretary Friday in a 50-50 vote, with Vice President JD Vance breaking the tie. The narrow victory came despite concerns about his qualifications and personal conduct, marking only the second time a vice president has cast a deciding vote for a Cabinet nominee.
Built on the trusted network of Fortune 500 companies, this blockchain company partners with Salesforce to uproot lengthy and expensive B2B transactions, and you can invest with just $100.
Financial records released Jan. 13 show Hegseth earned over $5 million in the past two years, mostly from his Fox News hosting role and speaking engagements. Beyond his Bitcoin holdings, the documents reveal he collected $4.6 million from Fox News and up to $1 million from a Baltimore rental property.
The Army veteran and former Fox & Friends Weekend host has openly backed cryptocurrency, praising its independence from government control.
During Coinbase Global's (NASDAQ:COIN) 2021 IPO, he called it the “tip of the iceberg” for digital currency adoption.
Trending: Nancy Pelosi Invested $5 Million In An AI Company Last Year — Here's How You Can Invest In Multiple Pre-IPO AI Startups With Just $1,000
“Crypto has arrived. Bitcoin is not a person, it’s not a company, it’s not a place. It’s tougher to stop than you would think,” Hegseth said at the time, according to cryptocurrency publication The Block.
Hegseth takes control of the Pentagon as Bitcoin trades around $100,000, potentially reacting to shifting political winds. His dual role as both a Bitcoin investor and America’s new defense chief arrives as digital assets face less scrutiny from the federal government.
The position puts him among the highest-ranking U.S. officials to publicly hold cryptocurrency, though his Bitcoin stake represents a small portion of his multimillion-dollar portfolio.
According to Juniper Research, the total value of B2B cross-border payments stored on the blockchain is projected to exceed $4.4 trillion — Join the first company to bring blockchain payments to Salesforce early with just $100.
© 2025 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
New Defense Secretary Pete Hegseth brings cryptocurrency holdings to the Pentagon’s top post, with financial disclosures showing he owns between $5,000 and $15,000 in Bitcoin amid his broader support for digital assets.
“Look at [Donald] Trump, making bitcoin great again,” Hegseth said during a Fox News segment in November after Bitcoin initially surged past $80,000. “All it took was signaling to that market that they weren’t going to be overregulated. Trump embraced them.”
The Senate confirmed Hegseth as defense secretary Friday in a 50-50 vote, with Vice President JD Vance breaking the tie. The narrow victory came despite concerns about his qualifications and personal conduct, marking only the second time a vice president has cast a deciding vote for a Cabinet nominee.
Built on the trusted network of Fortune 500 companies, this blockchain company partners with Salesforce to uproot lengthy and expensive B2B transactions, and you can invest with just $100.
Financial records released Jan. 13 show Hegseth earned over $5 million in the past two years, mostly from his Fox News hosting role and speaking engagements. Beyond his Bitcoin holdings, the documents reveal he collected $4.6 million from Fox News and up to $1 million from a Baltimore rental property.
The Army veteran and former Fox & Friends Weekend host has openly backed cryptocurrency, praising its independence from government control.
During Coinbase Global's (NASDAQ:COIN) 2021 IPO, he called it the “tip of the iceberg” for digital currency adoption.
Trending: Nancy Pelosi Invested $5 Million In An AI Company Last Year — Here's How You Can Invest In Multiple Pre-IPO AI Startups With Just $1,000
“Crypto has arrived. Bitcoin is not a person, it’s not a company, it’s not a place. It’s tougher to stop than you would think,” Hegseth said at the time, according to cryptocurrency publication The Block.
Hegseth takes control of the Pentagon as Bitcoin trades around $100,000, potentially reacting to shifting political winds. His dual role as both a Bitcoin investor and America’s new defense chief arrives as digital assets face less scrutiny from the federal government.
The position puts him among the highest-ranking U.S. officials to publicly hold cryptocurrency, though his Bitcoin stake represents a small portion of his multimillion-dollar portfolio.
According to Juniper Research, the total value of B2B cross-border payments stored on the blockchain is projected to exceed $4.4 trillion — Join the first company to bring blockchain payments to Salesforce early with just $100.
© 2025 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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