- Switzerland’s Sygnum Bank now offers the BTC Alpha Fund, giving clients exposure to Bitcoin price appreciation plus yields for simply keeping the product in their portfolio.
Sygnum, a digital asset bank in Switzerland, has recently launched the Starboard Sygnum BTC Alpha Fund. The fund was a product of its partnership with Starboard Digital and Starmark. The partners serve as Alternative Investment Fund Managers (AIFMs) for the fund, while Sygnum provides the product’s regulated distribution and banking infrastructure.
Key Features of Sygnum’s BTC Alpha Fund
The Cayman Islands-domiciled BTC Alpha Fund basically addresses the trade-offs investors usually face when investing in Bitcoin (BTC)-based products, particularly in generating yields while maintaining exposure to the asset’s price. In the past, the conventional dilemma for professional and institutional investors was a choice between two limited options:
- The first one is through a passive “HODL” approach that involves holding Bitcoin directly or through a passive investment vehicle like a spot exchange-traded fund (ETF). This strategy offers price exposure, which earns as Bitcoin appreciates but does not generate passive yields.
- The second is involvement in crypto-native yield strategies such as lending on decentralized finance (DeFi) or centralized exchanges. These usually entice people with high returns but also carry considerable risks, including counterparty risks, smart contract vulnerabilities, and potential insolvency of centralized platforms.
The BTC Alpha Fund employs advanced arbitrage trading strategies to bridge the two options. The market-neutral strategy ensures clients generate a consistent yield without relying too much on BTC’s price appreciation. In short, even in bearish events when BTC is not performing well against fiat, holders can still steadily grow the number of BTCs they own over time, giving them more leverage once the market recovers.
All these operate within a more familiar and regulated infrastructure, making them a more viable and secure option for professional and institutional investors.
BTC Alpha Fund Yield
“Bitcoin has become a key exposure in modern portfolios, and many of our clients want to stay invested while building their positions further,” said Markus Hämmerli, BTC Alpha Fund program lead at Sygnum. “The BTC Alpha Fund helps investors participate in Bitcoin’s price performance while aiming to earn additional Bitcoin through trading returns, all within an institutional-grade framework.”
Sygnum highlighted that the BTC Alpha Fund targets 8% to 10% annual returns, inclusive of fees. The issuer pays the yields in Bitcoin to allow investors to gradually grow their BTC holdings over time.
