Digital Securities: ADDX Launches First Crypto Fund by Trovio

ADDX (formerly operating as iStox), a digital securities exchange backed by the Singapore Exchange (SGX), has launched its very first product, according to a note from the company. ADDX has listed a crypto fund managed by Trovio Capital Management (TCM). The fund aims to a competitive option for crypto investing. The fund is said to have recorded a net return of 215% in 2020 and 205% in the first ten months of 2021. The offering is available to accredited investors. Under Singapore law, an accredited individual investor as an individual whose net personal assets exceeds in value SGD 2 million, or whose financial assets exceed in value SGD 1 million, or whose income in the preceding 12 months is at least SGD 300,000.

ADDX is a full-service capital markets platform with the Monetary Authority of Singapore (MAS) licenses for the issuance, custody, and secondary trading of digital securities. Launched in 2017, the company raised USD $50 million in its Series A round in January 2021.

ADDX shareholders include SGX, Temasek subsidiary Heliconia Capital and Japanese investors JIC Venture Growth Investments (JIC-VGI) and the Development Bank of Japan (DBJ).

ADDX states that individual accredited investors using the ADDX platform today come from 27 countries, spanning Asia Pacific, Europe, and the Americas (but not the US).

The TCM Digital Asset Fund will hold core positions in Bitcoin and Ethereum, along with a set of seven other cryptocurrencies that will be identified and reviewed regularly through a quantitative analysis. The fund utilizes an independent administrator, custodian, and auditor – KPMG.

Custody and trading services are provided by US-based Coinbase.

Investors on the ADDX platform may subscribe to or redeem units each month with the fund manager. The fund’s minimum investment size is US$10,000.

Trovio Group is led by CEO Jon Deane who was previously Managing Director and Head of Asia Commodities Trading at JP Morgan from 2014 to 2018.

Deane said it had been a good experience bringing the fund to ADDX’s MAS-regulated platform.

“We are continuing to witness significantly wider adoption and appreciation of digital assets as a standalone asset class in a diversified portfolio. ADDX’s platform is enabling investors to seamlessly access these asset classes, whilst reducing friction often experienced via traditional channels. We look forward to working with the ADDX team on launching our other products over the coming months.”

Oi Yee Choo, Chief Commercial Officer of ADDX, described cryptocurrencies as the digital gold of our age.

“There is robust demand among investors for exposure to these digital assets. The traditional world of finance tried to keep a cautious distance initially. But today, major financial institutions either have a crypto offering or are seriously considering one. We believe the time for discussing whether cryptocurrencies have a place in an investment portfolio is all but over. The more relevant question now is around how one should manage the risk of crypto investments, from an asset custody as well as a price volatility standpoint. Professionally managed crypto funds with a good track record can potentially address these risk concerns for investors.”

She added that ADDX is pleased to work with Trovio on this first crypto offering noting that the team led by Deane has deep expertise in both traditional finance and the crypto space:

“… his is reflected in their rigorous approach to conceptualising and bringing to market this institutional-grade fund. As Singapore establishes itself as an important global hub for regulated crypto activity, ADDX seeks to make a positive contribution to the crypto landscape of the city, by adding to the rich diversity of high-quality offerings available to investors.”

 

 


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