The new Bitcoin funds strive to provide reliable and secure vulnerability to Bitcoin for professional investors.
Fintonia Group, a Singapore-based fund manager, has developed two institutional-grade Bitcoin (BTC) funds that have been accepted by Singapore's Monetary Authority (MAS).
Fintonia unveiled the new funds, the Fintonia Bitcoin Physical Fund and the Fintonia Secured Yield Fund, on Nov. 25. They are meant to give professional investors with simple and safe exposure to Bitcoin.
The Fintonia Bitcoin Physical Fund is intended at institutional investors looking for direct exposure to Bitcoin, enabling them to buy, store, and trade huge amounts of the cryptocurrency. “The fund acquires physical Bitcoin, meaning we will buy the actual Bitcoin rather than a derivative instrument on Bitcoin,” according to Fintonia founder and chairman Adrian Chng.
In contrast, the Fintonia Secured Yield Fund gives investors access to private loans secured by Bitcoin.“Bitcoin is an excellent form of collateral for loans. It trades 24/7 and is highly liquid, with approximately $30 billion to $60 billion per day. If required, it can be quickly liquidated in comparison with, for example, commodities and real assets,” Chng said.
These funds depend on a third-party authorized custodian to store customers' cryptocurrencies on cold wallets. Investments are also protected against theft and hacking, according to the company.
Fintonia intends to eliminate crypto-to-fiat friction as a MAS-regulated fund manager that adheres to Know Your Customer and Anti-Money Laundering regulations. "These open-ended funds provide professional investors with a recognised legal and regulatory structure, comparable to that of a normal mutual fund," according to the release.
Fintonia Group is a regulated financial services corporation established in 2014 with a focus on fintech. According to Chng, Fintonia has been active in cryptocurrency since its start and now focuses only on cryptocurrency since it "has evolved into a separate asset class.”
The news reinforces Singapore's dedication to becoming a central global cryptocurrency centre, as local officials have approved a number of licences to legalise cryptocurrency trading in the country. Singapore is developing "very strong regulation," as per MAS managing director Ravi Menon, to enhance its position as the world's crypto hub.