Swiss Bank Sygnum Launches Bitcoin Yield Fund Amid Rising DeFi Interest
Swiss digital asset bank Sygnum has introduced the BTC Alpha Fund, an investment vehicle to generate yield on Bitcoin without affecting investors' exposure to price changes.
- The fund targets net annual returns of 8%-10% through arbitrage strategies, with returns paid in Bitcoin.
- Domiciled in the Cayman Islands, it is aimed at professional and institutional investors.
- Participants can increase their Bitcoin holdings from arbitrage gains while benefiting from long-term price appreciation.
- This initiative aligns with a growing interest among institutional investors to leverage DeFi for income generation from Bitcoin holdings.
- Currently, only about 0.8% of Bitcoin supply is used in DeFi, indicating a substantial untapped opportunity.
Sygnum allows fund shares to be pledged as collateral for U.S. dollar Lombard loans, providing liquidity without selling crypto assets. The fund offers monthly liquidity and employs a strict risk management framework.
The BTC Alpha Fund adds to Sygnum's suite of regulated products, bridging traditional finance with the crypto economy.