Over the last couple of years, the crypto industry has made a name for itself especially since Bitcoin was linked with many rags to riches stories. Since then, it has been speculated that the introduction of institutional investors in this space would be highly beneficial for the growth of this industry.
One of the key reasons why Bitcoin and cryptocurrencies as a whole haven’t reached the tipping point of mainstream adoption is volatility. This is kind of a double-tipped sword that has brought bitcoin into the limelight and is now acting as a hurdle for its growth.
However, Wall Street has played a vital role in numbing the effects of BTC’s volatility with the introduction and acceptance of traditional investment products like Futures and ETFs. The likes of CME offering BTC futures trading have performed exceptionally well and institutional interest in cryptocurrencies have grown immensely.
A previously unknown Bitcoin Fund
Now, a Forbes report further adds to the tale of the two worlds, stating that the New York Digital Investment Group (NYDIG) has sold nearly $140 million in a previously unknown Bitcoin fund dubbed the NYDIG Bitcoin Yield Enhancement Fund LP.
As per the report, the fund is described as a pooled investment fund that started selling a week before, on May 5th. NYDIG had previously received a BitLicense back in 2018, and the fund has now been disclosed in a Form D filing for an exemption to the US Securities and Exchange Commission (SEC).
Since it is a pooled investment where multiple investors have participated in raising the capital, NYDIG has requested the exemption under Rule 506(b) of the Regulation D safe harbor protections.
While no additional information about the fund is available at the moment, NYDIG made an earlier investment named the Bitcoin Strategy Fund. The report adds that this fund was advised by Stone Ridge Asset Management LCC, New York-based investment Management Company with ties to Benjamin Lawsky, popularly known as the “Sheriff of Wall Street.”
What’s interesting is that Lawsky is known for creating and establishing the BitLicense, which was also granted to NYDIG. The report adds that it is unclear when Lawsky joined Stone Ridge, but he is listed as Stone Ridge’s head of regulatory affairs. He is also a board member for blockchain-based payment protocol Ripple since 2017.
As of now, it is unclear whether Stone Ridge has advised this newly revealed fund, but it is a possibility.
Crypto making its mark
The news comes a day after JP Morgan opened accounts for two cryptocurrency exchanges namely Coinbase and Gemini. This is a great milestone for the crypto industry itself as this paves the path for new possibilities where banks work hand in hand with crypto-based companies.
Furthermore, Canada’s digital asset fund manager, 3iQ Corp, recently announced that The Bitcoin Fund completed the offering of Class A Units and Class F Units for $11.87 and $11.63 respectively. Thus, the total gross proceeds were close to $48 million.
Ultimately, it is evident that the crypto industry will benefit greatly if it deepens its roots in the institutional space.