Sygnum Launches BTC Alpha Fund Aiming for 8-10% Yield on Bitcoin in Switzerland
Swiss digital asset bank Sygnum is introducing a fund designed to help investors enhance their Bitcoin yield while keeping exposure to price fluctuations.
Summary
- Digital asset bank Sygnum has teamed up with Starboard Digital to establish the BTC Alpha Fund
- The fund provides investors with BTC price exposure while also yielding returns
- Starboard Digital will handle the arbitrage to create yields
Swiss digital asset bank Sygnum has unveiled a new product aimed at investors wishing to earn yield on Bitcoin without compromising on price exposure. On October 1, Sygnum launched the BTC Alpha Fund in partnership with Athens-based digital asset trading firm Starboard Digital, as detailed in a crypto.news press release.
“Bitcoin has become an essential component in modern portfolios, and numerous clients are eager to remain invested while further expanding their holdings,” stated Markus Hämmerli, who oversees the BTC Alpha Fund initiative at Sygnum. “The BTC Alpha Fund enables investors to engage in Bitcoin’s price movements while striving to earn additional Bitcoin through trading profits within a robust institutional structure.”
The BTC Alpha Fund, which is based in the Cayman Islands, aims for annual returns of 8–10% in Bitcoin terms, net of fees, with payments also made in Bitcoin (BTC). Yield generation through arbitrage trading will be managed by Starboard Digital, while Sygnum will act as the custodian. The specific arbitrage strategies were not disclosed by either firm.
“Creating yield on Bitcoin while preserving exposure to its potential appreciation has posed a significant challenge for institutional investors,” remarked Nikolas Skarlatos of Starboard Digital. “Our collaboration with Sygnum presents one of the limited high-quality institutional frameworks available to grow Bitcoin assets.”
How Bitcoin Generates Yields
For years, Bitcoin yields have existed in DeFi, either through arbitrage or lending. Traders can exploit cross-exchange price spreads or inconsistencies in the futures market to achieve low-risk arbitrage profits. However, traders who lend or entrust their Bitcoin to third parties often face counterparty risks, as evidenced by incidents involving companies like Celsius or BlockFi.