Hedge Funds
Room40 to hand back all outside capital as founder Yablon rejoins Moore Capital
The digital-asset hedge fund founder cited crypto security risk and scarce opportunity in a letter to investors.
HedgeWeekly Hedge Fund Desk ·
Room40 Capital, the digital-asset hedge fund founded by former Moore Capital portfolio manager Paul Yablon, is returning all of its external investor capital, Hedgeweek reported, citing an investor letter seen by Bloomberg. The firm will continue to run proprietary money plus capital from a single institutional investor.
Yablon plans to broaden the strategy beyond digital assets into macro trading and is rejoining Moore Capital as a macro portfolio manager, according to a person familiar with the appointment. In the letter he pointed to last month's $6.3 billion theft at Binance as an example of sector risk, while saying Room40 had no exposure to it, and said attractive asymmetric opportunities in crypto had become scarce.
Room40 reported about $262 million in regulatory assets at the end of 2025. Yablon told investors the fund has returned 14.4% annualised since its May 2022 launch.
The move adds to an industry-wide pattern of closures: Hedge Fund Research data cited in the report shows more than 3,100 funds have shut since the start of 2020. For allocators, it is another example of a specialist crypto strategy running out of perceived edge, and of macro platforms recruiting talent from the shrinking pool of niche managers.