Investors can use fund shares as collateral for Lombard Loans without selling Bitcoin holdings.
Swiss-based digital asset bank Sygnum has launched the BTC Alpha Fund for investors to grow their Bitcoin without selling it. This new Fund promises 8%-10% yearly returns paid in Bitcoin, using smart arbitrage and DeFi strategies to turn idle holdings into bigger stacks.
Here’s how!
In a recent announcement, Sygnum noted that the BTC Alpha Fund is designed for professional and institutional investors who want security and growth. Unlike other products, investors don’t need to sell their Bitcoin, the fund aims to increase their holdings.
It uses arbitrage trading strategies to earn profits, which are converted into Bitcoin and added back to investors’ wallets. Meanwhile, the fund targets 8-10% returns per year, making it one of the few options to earn yield on BTC.
Currently, only 0.8% of Bitcoin’s supply is used in DeFi, less than $6.5 billion of the nearly $1 trillion market. This shows huge potential for growth in Bitcoin-based yield products.
Markus Hammerli, who leads the BTC Alpha Fund, says the product is already seeing strong interest. Sygnum also notes that every $1 billion flowing into Bitcoin ETFs could push prices up 3-6% because of Bitcoin’s limited supply and the multiplier effect
While decentralized finance (DeFi) shows that Bitcoin can earn income, adoption is still small. By offering a regulated fund, Sygnum aims to meet this demand while giving investors a safer option compared to riskier DeFi projects.
In addition, Sygnum has linked the fund to its broader banking services. Shares of the BTC Alpha Fund can be used as collateral for Lombard Loans, giving investors access to liquidity without selling their Bitcoin exposure.
This is a valuable tool for long-term holders who often struggle with cash flow while keeping their BTC untouched.
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