Waves Financial launches world’s first Bitcoin yield fund

posted 10 months ago
Los Angeles-based asset management firm Wave Financial reportedly created the world's first Bitcoin-based yield fund, which aims to generate an investment yield by selling call options on Bitcoin held inside its fund. Call options are financial contracts that gives the option buyer the right (but not obligation) to buy an asset at a specified price within a specific time period.

Wave Financial hopes to distribute a dividend of 1.5% per month (18% annual.) Excess premiums generated above the fund’s target yield rate will be credited back to purchase more bitcoins. The fund generates this premium by “selling call options with strikes higher than the current price” to capture potential upsides in the price of Bitcoin. Wave’s fund will be incorporated in the British Virgin Islands, while financial services provider Fidelity Digital Assets will provide custody for the fund’s BTC.
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