As a bitcoin-linked actively managed certificate (AMC) becomes the second largest actively managed strategy linked to the cryptocurrency, product providers across the world are looking at traditional structured products structures to deliver access to digital assets.
Zeltner & Co., a Swiss investment boutique and family office, is targeting professional investors seeking to outperform bitcoin on an absolute return or a risk-adjusted return basis and go beyond the delta one exposure offered by ETFs.
By personally allocating their holdings to develop this investment product, the bitcoin whale not only addresses the issue of bitcoin’s volatility but also enhances its viability as a stable medium of exchange
The product is designed to curb bitcoin's volatile pricing and invests algorithmically in bitcoin and US dollars with the goal of capturing a volatility premium while optimising the risk-return profile of bitcoin investments and providing liquidity to the BTC/USD spot market.
With over US$50m in assets under management the Bitcoin Volatility Premium AMC has quickly become the largest actively managed bitcoin-only financial product in Europe and the second largest globally after the Purpose Investments Bitcoin Yield ETF (BTCY), with over CAD109m (US$80.8m).
Source: Zeltner & Co.
What makes this investment product interesting is that the Swiss boutique confirmed that the seed investment of US$50m to launch came from an unknown early crypto native involved in mining Bitcoin since 2010.
Zelter & Co. stated that the creation of this AMC, aimed at stabilizing Bitcoin's price, showcases a strategic approach to managing digital assets.
'By personally allocating their holdings to develop this investment product, the bitcoin whale not only addresses the issue of bitcoin’s volatility but also enhances its viability as a stable medium of exchange.'
This is the second crypto AMC launched by the Swiss boutique – earlier this year Zeltner & Co. reported more than 100% return for its Cryptocurrency Frontier AMC launched in June 2022.
Source: Zeltner & Co.
There are several large Bitcoin ETFs that actively manage futures positions, such as the ProShares Bitcoin Strategy ETF (BITO), with over US$2.82 billion in assets under management (AuM); however, these are not actively managed funds in the traditional sense. Instead of trying to outperform or optimize the risk/return of a direct investment in bitcoin, futures ETFs aim to track the price of bitcoin 1:1.
Dubai neobank includes cap protection on digital range
Dubai-based neonbank Keytom has launched a range of digital asset investment strategies designed to cater to diverse investor needs and risk appetites, by focusing on optimising the risk/return ratio when investing in Bitcoin, Ethereum and other cryptocurrencies.
Comprising a total of four distinct products, Keytom's new range include Perpetual and Delta-Q, two market-neutral strategies that allocate investor funds to both CeFi and DeFi assets. By separating profit generation from market movements, these strategies can mitigate the associated trading risks, and offers investors the potential to earn returns of up to 12-14% APY regardless of market fluctuations.
The new range includes a classic example of a structured investment product – the Advalor strategy focuses on investing in BTC/ETH products, offering up to 100% risk protection and up to 70% profit of the underlying growth. The extent of risk can be selected based on the investors' risk preference, whether they lean towards risk aversion or risk-seeking behaviour along with their desired income level.
For investors with higher risk appetites and longer investment horizons seeking higher returns Finally, Keytom offers the B-Halver strategy which leverages the Bitcoin halving event of 2024 . This product uses custom-built AI algorithms to construct investment portfolios with constant rebalancing and strategic asset allocation - 30% of the portfolio is allocated to bitcoin, while the remaining 70% is diversified across coins selected via AI.
'By allowing clients to allocate idle account balances towards generating superior passive yields, surpassing those offered by traditional staking methods, this strategic integration promises to not only optimise client returns but also strengthen our competitive position in the market,' said Evgeny Filichkin, Investment Advisor at Keytom.
OKX adds BETH to its dual investment product
Crypto exchange and Web3 technology company OKX has announced the addition of BETH to its Dual Investment structured product, with terms ranging between 23 hours to 244 days.
The latest addition to the exchange is aimed at investors seeking to maximise their profits by choosing a major crypto pair to trade, such as BTC - USDT.
By subscribing to a Dual Investment product, users can buy or sell an options contract and receive returns in either of the cryptocurrencies - depending on their target price.
OKX also announced the listing of Runecoin on Tuesday, 30 April, following a 24-hour rewards campaign offering customers a share of tokens by staking their Bitcoin on the exchange’s platform.
Runecoin will be the first Runes token listed by the centralized exchange, though OKX’s peer-to-peer “Web3 marketplace” already supports Runes token trades.
Runecoin is a token etched on the Runes protocol with the airdrop size of 888 Satoshis. Runecoin's 21 billion token supply pays tribute to bitcoin's famous 21 million 'hard cap.'
NAV adds structured products, regulatory compliance
Quantitative hedge fund NAV has announced the launch of a range of structured investment products (SIPs) designed to optimise yields while mitigating risk and ensuring regulatory compliance.
By bridging the gap between traditional finance and blockchain technology, NAV offers investors a secure and accessible gateway to the world of DeFi.
The new products will leverage advanced strategies such as dynamic rebalancing and multi-protocol integration to deliver superior returns. One of the platform's flagship product, the Eigen Layer SIP, combines multiple liquid staking derivatives and concentrated liquidity pairing to maximise yield potential.
NAV which operates within the legal framework of the British Virgin Islands (BVI), believes that stringent standards of transparency, accountability and investor protection will 'instill confidence in investors, making NAV a trusted choice for institutions and individuals alike'.
'Our mission is to democratize access to sophisticated investment strategies while prioritizing security and compliance,' said Jordi D., founder and CEO of NAV. 'By combining the best aspects of traditional finance with the transformative potential of DeFi, we are creating a new paradigm for investing in the digital age.'
Digital asset platform gets Bahrain crypto license
Digital asset services firm ARP Digital has received a license from the Central Bank of Bahrain to operate in the Middle Eastern country, providing services including crypto trading, custody and portfolio management services to customers.
The firm has been granted the category-3 license and is the only over-the-counter (OTC) service provider focused on structured products that Bahrain's Central Bank regulates, ARP Digital said.
The Middle East and North Africa (Mena)-based firm said its products are catered to the sophisticated needs of high-net-worth, accredited, institutional, and family office investors globally. ARP Digital will offer services to traditional-finance and crypto-native investors.
'The firm designs both off-the-shelf and customized investment solutions to ensure it can accommodate a broad range of market views expressed by its clients,' the company said in a press release. 'Moreover, ARP Digital aims at being inclusive to a wide range of clients by enabling multiple delivery and settlement options such as cash or kind settled OTC products, bankable structured notes, and fund products.'
The management team includes co-founder Yusuf Alireza, who spent 20 years at Goldman Sachs and was the first-ever Arab partner in the Wall Street firm's history. The other co-founders, Abdulla Kanoo and Abdulaziz Kanoo, were former regional directors for Amber Group’s crypto trading firm business in Mena.
Image: Ake1150/Adobe Stock.
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