IDEG Investment Ltd, a professional digital asset management company, announced on Nov 27 in Hong Kong the launch of Asia Bitcoin Trust I and Atlas Mining Trust I, two trusts designed as a traditional and comfortable way for ‘old money’ to invest in digital assets. Asia Bitcoin Trust I is an actively managed vehicle which offers accredited and institutional investors compliant, secure, and professionally wrapped bitcoin exposure supported by selected service providers. Atlas Mining Trust I is a first of its kind vehicle allowing traditional investors to participate and share profits from Bitcoin mining activities. The total size of the two trusts is $200 million.
“Bitcoin is a unique asset class that has no correlation with any traditional asset. Investing in Bitcoin can optimize the risk-to-reward ratio of portfolios,” said Raymond Yuan, Founder of IDEG. “It’s time for the institutional investors to include digital assets in their asset allocation strategies. Our positioning is to be a bridge to connect traditional investors and digital assets with the highest transparency and the highest security in the industry.”
Unlike passively managed funds and trusts like Grayscale Bitcoin Trust, Asia Bitcoin Trust I is an enhanced Bitcoin trust, which seeks to improve returns by using active management. “We’ve been in the quantitative trading business for a long time. Some of our core members have been trading digital assets since 2013,” said Kevin Yang, CEO of IDEG. “As the investment manager of the Trust, IDEG will apply a range of hedging and arbitrage strategies in order to gain more Bitcoin for the investors and meanwhile effectively control the risk of drawdowns.”
More than 18 million Bitcoin have been mined and only 21 million Bitcoin will ever exist. Mining of Bitcoin alone offers market participants $4 billion to $8 billion in annualized revenues. “The mining business is quickly evolving, with more and more institutionalized miners stepping in. The keys to mining efficiencies in hardware, infrastructure and electricity costs. Individual miners are dropping out because institutional miners like us can improve in almost every aspect, including capex, opex, operation, and risk management,” said Raymond Yuan. “That’s why we have a much higher return ratio than other miners.”
Coinbase Custody, the world’s largest digital asset custodian holding over 900,000 Bitcoins, will act as the custodian for both trusts. Profound Trust Company Ltd., a trust company with more than 1000 clients in Asia, is acting as trustee. “Nowadays as more and more institutions and sophisticated investors seek exposure to the blockchain and digital asset market, they demand compliance, security, and professionalism. We seek the highest standards in these aspects. The two trusts are designed to offer such investment vehicles for investors,” said Lu Qi, CEO of Profound Trust.