Swiss Asset Management Firm Base58 Capital to Launch First Crypto Fund Out of Malta
Today we are very excited to announce that we have obtained the in-principle approval to launch an actively managed crypto fund out of Malta. The Maltese Financial Services Authority (MFSA) granted us their in-principle approval under the new supplementary conditions applicable to collective investment schemes that came into effect on January 29th, 2018. After initially contacting the Maltese regulator and contributing to the request for feedback during Q4 2017, we were the first company to submit an application to the MFSA under its Professional Investor Fund (PIF) regime. The approval marks a historic milestone in our history and the history of Malta as a domicile for cryptoasset funds.
Actively Managing the Whole Universe of Cryptoassets
The fund will be actively managed with a long bias and will invest globally from early-stage projects to more mature protocols like Bitcoin and Ethereum. Fabio Federici, Founder and CEO of Base58, said: “Our investment thesis is grounded in the fundamental innovation underpinning cryptoassets: decentralized trust.”
“Our investment thesis is grounded in the fundamental innovation underpinning cryptoassets: decentralized trust.”
“While we are excited about the new ways for tokens to raise capital, we believe the biggest opportunities for investors lie in the projects that are uniquely enabled by this technology. Once you have identified a use case, where you need a permissionless, trustless, censorship-resistant asset, the question becomes: ‘How do you design the system in a way that the value of this network will accrue at the level of the token?’ Those are the projects we are looking to identify and add to the portfolio, because that’s the type of new asset that, from an investment perspective, can generate asymmetric returns.”
While crypto markets have been cooling off after the frenzy of 2017, Base58 concentrates on the actual progress and activity in the various projects — factors which we believe determine the long-term success of protocols and applications.
Our primary clients are qualified and institutional investors, such as family offices and funds of funds. “Many clients need access to the universe of cryptoassets with an established framework. This gives them operational and legal certainty,” says Tommaso Bonanata, Head of Investment Management at Base58. “Eventually, this asset class will become like any other, where combining a qualitative and systematic approach will become essential,” says Bonanata. “Usually, what we look at in traditional finance, is if an asset is mispriced. In cryptoassets, it’s a bit more complicated. Our investment horizon allows us to focus on fundamentals and let projects reach maturity while keeping a tight focus on the aggregated portfolio liquidity, which is important for our clients.”
“Our investment horizon allows us to focus on fundamentals and let projects reach maturity while keeping a tight focus on the aggregated portfolio liquidity, which is important for our clients.”
The Evolving Role of Cryptoasset Managers
We are one of Switzerland’s first regulated cryptoasset investment management companies. The company was founded by Fabio Federici, who in 2014 co-founded Coinalytics (later Skry), a blockchain analytics company in Palo Alto. The team includes software engineers and asset managers with a strong track record in Emerging Markets and Alternative Investments, with many years of professional experience in Silicon Valley, Switzerland, and Liechtenstein. Still, Base58 is more than an asset management firm. With the outlook of cryptoassets reshaping the financial services industry, the company actively explores how decentralized protocols impact the role of asset managers and open up new opportunities for investing capital in the future.
What’s on the horizon for Base58? “Getting the fund off the ground is our primary focus over the coming months,” says Fabio Federici. “Because of its flexibility, Malta is the ideal jurisdiction for the fund. At the same time, our asset management company is domiciled in Switzerland. With its start as Crypto Valley and the long-lasting tradition of asset management, Switzerland has an amazing opportunity to become the major hub for talent in this space. Our goal is to build a global ecosystem where we can share ideas and contribute to the advancement of decentralized technologies.”