- Fidelity Digital Assets Is Now On Board to Provide Custody for BTC Derivatives Yield Fund
- Funds Are Built on Derivatives Today Because of the Simplicity of Trading Platforms
Bitcoin News Today – The emergence of more digital currency trading platforms has greatly contributed to the exposure and accessibility of digital currencies across the globe. Some top digital currency trading platforms have also made cryptocurrency derivatives trading more accessible to investors. Now, an asset management firm wants to have a go at Bitcoin-options-based fund.
Wave Financial – a Los Angeles-based firm – just launched the Wave BTC Income & Growth Digital Fund. The firm touts the fund as the first digital currency derivatives-based yield fund in the market. The managing partner of Wave Financial – Ben Tsai – said:
“I think what was missing in the digital currency market is a lot of very solid traditional types of products, but with digital currency assets.”
Bitcoin (BTC) Price Today – BTC / USD
Fidelity Digital Assets Is Now On Board to Provide Custody for BTC Derivatives Yield Fund
Tsai said that after some months of due diligence, Fidelity Digital Assets is now on board to provide custody for Bitcoin (BTC) derivatives yield fund. The firm aims to capture part of a new market of yield products in the digital currency space. They want to build on creativity from the growth of the digital currency derivatives platforms and traditional funds that form the basis of the technical aspects of these new funds.
The Wave fund wants to generate income on a monthly basis with the premium from selling call options with strikes 20% more than the present price. The fund plans to share dividend that is 1.5% net asset value of the BTC held in the fund, possibly resulting in an annual yield of 18%. Tsai said that the BTC income fund charges 100 basis points fixed management yearly, and collects 30% of any returns over the 18% yield, returning the rest back into the fund.
Funds Are Built on Derivatives Today Because of the Simplicity of Trading Platforms
All these funds are possible as a result of the operational simplicity offered by top crypto trading platforms providing new platforms to trade digital currency derivatives. This month, Binance bought JEX – a crypto trading platform – to boost its crypto derivatives offerings to traders. JEX offers derivatives and spot including futures trading and options in cryptocurrencies.
Last month, Deribit – digital currency futures exchange – said it has become one of the first trading platforms for digital currency futures and options to provide large-volume trades of Ethereum and Bitcoin derivatives. Earlier this year, Caspian – an institutional trading and portfolio management platform backed by Galaxy Capital – launched trading in digital currency derivatives including options and futures. More digital currency trading platforms have revealed their plans to offer such services.