ByCoinGape
Key Highlights
Brevan Howard Digital, one of the world’s largest institutional crypto hedge funds, is now looking to shift capital allocation.
The fund is considering the shift after suffering heavy losses last year. This was alongside leadership changes and a decline in assets under management.
According to a Financial News report citing people familiar with the matter, the firm’s digital asset division is broadening its investment strategy to include opportunities across the stablecoin ecosystem.
Since its launch in 2021, BH Digital is Brevan Howard’s dedicated digital asset investment business. It provides institutional investors with exposure across cryptocurrencies, blockchain infrastructure, venture investments, and digital asset trading strategies. The platform already describes its approach as a diversified multi-strategy model supported by institutional-grade risk management and a global investment team on its website.
The reported shift comes months after BH Digital recorded its worst year since launch.
According to the last Financial Times report, BH Digital’s assets under management, which once peaked at around $2.5 billion, have fallen to below $2 billion following last year’s losses, despite continued investor inflows. The fund lost nearly 30% in 2025.
Under new Chief Investment Officer Chris Rayner-Cook who heads the fund’s crypto treasury’s solutions, BH Digital has shifted its capital allocation. It has now returned to modest positive performance in recent months.
BH Digital’s interest in the stablecoin ecosystem has also become evident through its recent investments. Last week, partner Colleen Sullivan announced the fund’s backing of Augustus, a startup building a “Global Dollar Bank” on stablecoin rails.
Explaining the investment, Sullivan said stablecoins have enabled U.S. dollars to move “24/7/365,” while traditional banking infrastructure remains constrained by banking hours and legacy payment systems. She said Augustus aims to rebuild banking on stablecoin rails with AI integrated from the start. It highlights BH Digital’s conviction that blockchain-based payments represent the next evolution of financial infrastructure.
The reported strategy comes as stablecoins become one of the fastest-growing segments of the digital asset industry.
According to defillama, the stablecoin market has grown to more than $330 billion. This has been driven by the growing conviction and rising usecases of stablecoins in payments, remittances, decentralized finance, and tokenized asset settlement.
Banks, fintech firms, and payment providers have all accelerated efforts to integrate stablecoins into traditional financial services as regulatory clarity improves. Recently, Japan’s JPYC also saw its yen-based stablecoin being accepted by over 2000+ contractors.
The reported shift also aligns with a broader institutional trend that CoinGape has highlighted previously. In an exclusive interview with Franklin Crypto Head Christopher Perkins, he argued that “the biggest risk for institutions is having no crypto strategy,” as digital assets become a permanent part of institutional portfolios. Read the full interview here: Franklin Crypto Head Christopher Perkins: The Biggest Risk for Institutions Is Having No Crypto Strategy.
Instead of focusing exclusively on directional cryptocurrency trades, hedge funds and asset managers are increasingly exploring alternative investments. These are tied to blockchain infrastructure, tokenization, digital payments, custody, and treasury management.
Interestingly, BH Digital remains an active crypto investor despite its recent challenges. According to CryptoRank, the firm has backed 61 crypto projects spanning liquid tokens, DeFi, infrastructure, and venture investments. Its tracked portfolio includes assets such as XRP, Morpho, Plume, Ethena (ENA), and IAG, while its top historical investments include StablecoinX.
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