By Gertrude Chavez-Dreyfuss

NEW YORK (Reuters), Several global cryptocurrency funds saw steep increases in value last year, led by bitcoins and ether, due to increased institutional interest, and better acceptance by regulators globally, according BarclayHedge.

According to BarclayHedge data posted Friday, the cryptocurrency traders index rose 138.1% in 2021. It showed results for approximately 39 funds or half of all the digital asset managers it tracks. This follows record-breaking gains of 173% for 2020 as crypto funds took advantage of extreme volatility in financial markets.

The cryptocurrency gained 60% as it reached an all-time high of $69,000, in November. Meanwhile, ether (the token that is used for blockchain technology) soared approximately 400%.

There is a sense of legitimacy. According to CoinDesk, Bitcoin is not a cryptic digital currency that’s used only by cypherpunks and techies anymore.

However, crypto funds lost around 11% in December as bitcoin and other cryptocurrencies fell. Bitcoin fell 19%, while Ethereum dropped 20%.

According to Ben Crawford, BarclayHedge’s head of research, “Crypto wasn’t the only sector that lost money in December as many of its headline assets were subjected to whiplash due to a sharp downturn.”

Crypto’s older cousin foreign exchange made modest returns for investors in 2021.

BarclayHedge’s currency traders index saw a 2.2% increase last year, using 60% of the funds reported. BarclayHedge currently tracks 40 FX programmes.

FX funds gained 4% last year, which was followed by a 20% gain in 2021. The global central banks have kept interest rates low, reducing volatility and limiting returns.

The December increase in currency funds returns was anemic at 0.2%.