Sygnum Launches Arbitrage BTC Yield Fund With 8–10% Target Returns
New BTC Yield Vehicle
Sygnum, the Swiss digital asset bank, has launched the BTC Alpha Fund in partnership with Athens-based Starboard Digital. The Cayman-domiciled fund is designed for professional and institutional investors and uses arbitrage trading strategies to deliver net annual returns of 8%-10%, paid directly in BTC.
The structure allows participants to grow the number of coins they hold while retaining exposure to long-term BTC price appreciation. According to Sygnum, client interest has been strong, reflecting growing demand for institutional-grade yield products in the digital asset market.
“BTC has become a key exposure in modern portfolios, and many of our clients want to stay invested while building their positions further,” said Markus Hämmerli, who is leading the BTC Alpha Fund initiative at Sygnum.
Investor Takeaway
Arbitrage and Market Context
The fund applies arbitrage strategies to exploit pricing gaps, with profits converted into BTC for distribution. Monthly liquidity and a risk management framework are built in to address digital asset volatility. Starboard Digital brings its trading and risk expertise to the partnership.
The launch comes as institutions look to move beyond passive BTC exposure and tap decentralized finance (DeFi) to earn additional income. While BTC DeFi remains small—Binance research recently estimated only 0.8% of total supply is currently deployed—the potential has been flagged as substantial. Last year, Franklin Templeton’s Julian Love suggested the market opportunity could reach $1 trillion.
Collateral and Liquidity Features
Sygnum added a practical feature by allowing fund shares to be pledged as collateral for U.S. dollar Lombard loans at the bank. This lets long-term holders unlock liquidity without tradeing down their BTC. The setup could appeal to investors viewking capital efficiency while maintaining core crypto positions.
The fund also offers monthly liquidity, giving participants flexibility in managing allocations. This design aims to attract investors cautious of digital market volatility but interested in regulated structures that mirror traditional finance practices.
Investor Takeaway
Sygnum’s Broader Push
The BTC Alpha Fund adds to Sygnum’s suite of regulated crypto products. Over the past year the bank has expanded its BTC offerings, including tokenized structured notes on ETH and blockchain-based services for institutional clients. It also manages the U.S. dollar reserves of the Global Dollar (USDG) stablecoin.
Sygnum’s collaboration with Starboard Digital highlights how banks and trading specialists are converging to build institutional crypto products. For investors, the fund represents one of the few vehicles in the market combining yield generation, direct BTC payouts, and integration with bank lending services.
