The first ever cryptocurrency firm to be listed on a major stock exchange has launched a new bitcoin fund.
DigitalX, which debuted on the Australian Securities Exchange (ASX) under its previous name DigitalBTC as far back as 2015, announced the new fund on Wednesday. The firm said it's offering qualifying wholesale and professional investors such as family offices and high-net-worth individuals exposure to the cryptocurrency via a "standard unlisted fund structure" without the effort and risk of holding it directly.
DigitalX executive director Leigh Travers said in the announcement:
To get the fund off the ground, DigitalX will provide 215 of its total 431 bitcoin, valuing its investment at around US$1.89 million at current prices. The firm said it aims to quickly grow the investment vehicle and hence its funds under management, and will see income via the fees receivable from the fund. Management fees are disclosed as being set at 1.65 percent annually, while no performance fees will be charged.
The fund's holdings will be secured via custody services provided by insurance-backed BitGo. DigitalX further plans to use "blockchain-based security" for the registration and transfer of units in the fund.
The Bitcoin Fund is licensed and administered by Boutique Capital, which is also the licensee of DigitalX's existing indexed crypto fund. Launched last April, that fund was said to give exposure to "leading" crypto assets and potentially ICO tokens.
DigitalX, following a move into bitcoin mining that was later abandoned, has morphed into a company offering blockchain consulting and development services and asset management. It's not been without its controversies, having been taken to court by investors over an ICO for which it acted as adviser. Its former executive chairman was also indicted by the US government for alleged involvement in a fraudulent text messaging scheme.
Bitcoin image via Shutterstock
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.