Following the Brazillian Securities and Exchange Commission’s (CVM) ruling to allow cryptocurrency fund shares and derivative investments, national firm Genial Investments has stepped up to offer the first approved financial product.
CVM passed the cryptocurrency policy as part of ‘Instruction 55‘ in September.
The ‘BLP Criptoativos FIM‘ fund is composed 20% of cryptocurrency related assets and 80% of treasury bills, with the internal regulations managed by Brazil Plural Bank. Its stated objective is to achieve a higher rate of returns than the Interbank Deposit Certificate long-term rate.
While investors using the fund will not have access to the direct strategy of the cryptocurrency portion, Genial says there will be a preference placed on the 20 most liquid cryptocurrencies.
Eduardo Salvatore, head of business development at local cryptocurrency exchange and partner of Genial Investments FlowBTC, said that the fund was a crucial move in diversifying cryptocurrency products on offer as interest in the industry grows. ”From FlowBTC’s point of view, it’s an important step that brings institutional investors into the picture,” Salvatore said, sharing the same optimism of cryptocurrency funds with those in the US, Europe, and Asia.
He added that although the fund may not appeal to ”classic early adopters”, the outcome would certainly be greater volumes of investment in the market, benefiting the whole ecosystem.
It is classified as an overseas investment fund, although it is open to the general public. The fund will charge a performance fee of 20% over what exceeds 100% of the Interbank Deposit Certificate. A minimum monthly contribution to the fund of BRL 500 (USD 133) is required until January 2019, and BRL 1,000 from February 2019.
Applications are now open for investors wishing to open a fund.
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