With its latest JPMorgan deal, crowdsourced quant hedge fund Numerai will more than double its assets under management.
Summary
- JPMorgan commits $500M under management by Numerai
- Numerai is a crowdsourced quant hedge fund powered by crypto
- Quant traders have to stake NMR tokens to make predictions
The crowdsourced quant hedge fund Numerai, backed by legendary investor Paul Tudor Jones, got another major backer. On Tuesday, August 26, Numerai announced that it had secured a $500 million commitment from investment banking giant JPMorgan. The deal more than doubles the quant firm’s assets under management, which are currently at $450 million.
JPMorgan’s commitment adds both institutional legitimacy and a potential new source of revenue for Numerai. For one, with more assets under management, Numerai can expect greater revenue. For this reason, the NMR token rose 41.03% after the announcement and is currently trading at $11.65. Despite the latest surge, the token is still trading below its multi-month high of $25.58 in December 2024.
How the Numberai quant hedge fund works
Numerai is a crowdsourced quant hedge fund, powered by its own native crypto. It enables freelance quant traders to submit their prediction models by staking numeraire (NMR) tokens. Winners earn rewards, while losers lose their staked tokens. What is more, Numerai adds the best-performing models to its master fund, which trades in equities.
“That’s when investors like JPMorgan started to be like: Whoa, you guys aren’t just back, you’re way back,” Richard Craib, Numerai’s founder, said. “People don’t really want to invest until there’s a track record. And when you’re doing something super unusual and different, like we are, they might wait even longer before they get excited.”
JPMorgan committed its funds after the fund achieved a 25% return in 2024, recovering from a loss it suffered one year earlier. Paul Tudor Jones, a world-famous hedge fund investor, is one of the investors in the fund.
