Securitize has launched Securitize Capital, LLC, a wholly-owned subsidiary, that will serve as an alternative investment manager of digital asset funds to provide investors exposure to cryptocurrencies and decentralized finance (DeFi) in the form of digital asset securities. Securitize Capital was born from the observation that it is complicated for institutional investors to access exposure to cryptocurrencies and the yields earned through blockchain DeFi strategies. Securitize Capital will provide vehicles for institutional and accredited investors to access that exposure.
Securitize Capital’s two flagship funds will launch in early June. They will provide investors direct exposure to Bitcoin (BTC) or USD Coin (USDC), with yields greater and fees lower than funds currently on the market.
The “Securitize Capital BTC Yield Fund” and “USDC Yield Fund” are both particularly well-suited for institutional and individual investors due to their traditional security structure and compelling management fee of just 0.50%. Moreover, these offerings stand to play a unique role as part of a balanced portfolio because they are unlikely to move in sync with the traditional financial markets, making them potential hedges against other market movements, and strong potential drivers of yield.
Securitize Capital has engaged Anchorage Lending CA, LLC, an affiliate of Anchorage Digital Bank, a premier digital asset bank, and Genesis, a prime broker, for sourcing lending opportunities. The funds will be administered by MG Stover & Co and audited by Spicer Jeffries, LLP.
When the funds will be open for participation in early June, they will initially be available only to accredited and institutional investors. To participate, investors will first need to create a Securitize ID account, after which they will gain access to the Bitcoin and USDC yield funds, as well as a digital asset marketplace containing a broad range of investment options including private equity, debt, commodities, funds, and other alternative assets.
Shares in the fund will be issued as digital asset securities recorded on the Algorand blockchain, with Securitize as the transfer agent.
“We see very strong demand from institutional investors for cryptocurrency exposure. They want to go beyond simply holding a cryptocurrency, but rather are seeking access to the yield generated by DeFi strategies,” said Carlos Domingo, CEO of Securitize. “Current offerings are very limited, mostly with no yields and high fees. There is nothing in the marketplace like the institutional-grade funds we are announcing today and we look forward to introducing more products like this in the future.”
“We’re proud to enable institutions like Securitize with a compliant, safe way to lend digital assets through Anchorage Financing,” said Anchorage Digital President and Co-Founder, Diogo Mónica. “Anchorage Digital has always been committed to bringing more access to digital assets and these funds make Bitcoin and stablecoin investment accessible for a whole new range of participants.”
“Genesis launched the first U.S. OTC bitcoin trading desk in 2013. Since then, we’ve grown to facilitate billions of dollars in monthly trades, loans and transactions – including over $60 billion in Q1 ’21. As demand for digital currencies by institutional investors increases, we’re pleased to be working with Securitize. Together, we’re making digital currencies and yield available to institutional investors in the form of funds they’re already familiar with,” said Matt Ballensweig, Head of Institutional Lending at Genesis.