The Bitcoin Volatility Premium AMC
is the largest actively managed Bitcoin-only investment product in Europe and the second largest globally. Launched with a significant seed investment from a mysterious early Bitcoin miner in 2010, this AMC aims to reduce Bitcoin's price volatility to improve its functionality as a stable medium of exchange.
Actively Managed Certificate (AMC)
An Actively Managed Certificate (AMC) is a structured security product popular in Europe that allows asset managers to raise capital from investors by pooling an investment strategy or assets that are then implemented using that capital. Unlike ETFs, which are passively managed, AMCs like the Bitcoin Volatility Premium aim to outperform the underlying assets.
Seed investor and objectives
The identity of the AMC's seed investor, an early Bitcoin miner, remains secret out of respect for their privacy. By channeling their Bitcoin holdings into this AMC, the investor aims to stabilize Bitcoin's value and promote its potential as a transaction currency.
Investment strategy and potential
The AMC's investment strategy combines algorithmic trading in Bitcoin and US dollars to capture a volatility premium, with target returns between 2% and 6% annually. The strategy includes market-making activities on exchange platforms such as Kraken, which increases liquidity and potentially influences Bitcoin's market dynamics as the investment grows.
Administration and location
Managed by Zeltner & Co., a renowned family office in Zurich, Switzerland, the AMC benefits from the region's conducive regulatory environment for finance and innovation. This geographic and regulatory advantage, combined with the AMC's novel investment approach, positions it advantageously in the digital asset space.
Summary and Outlook
Overall, the launch of the Bitcoin Volatility Premium AMC is an indicator of the ongoing evolution in digital asset management, with the aim of mitigating one of the biggest hurdles to Bitcoin's mainstream adoption - its volatility. The strategy not only aims to generate returns, but also aims to help transform Bitcoin into a viable global medium of exchange.
The Bitcoin miner for your desk
