South Africa\u2019s Sygnia, which started a Bitcoin exchange-traded fund in June, says it will dissuade investors from switching all their assets into the high-risk crypto fund.<\/p>\n\n\n\n
The Sygnia Life Bitcoin Plus fund uses the iShares Bitcoin Trust ETF as the benchmark, according to a fact-sheet on the asset manager\u2019s website. <\/p>\n\n\n\n
Bitcoin, which has jumped 82% in the past 12 months, fell 2.3% to $112,735.12 as of 10h18 in Johannesburg.<\/p>\n\n\n\n
The world\u2019s biggest cryptocurrency is prone to wild swings even though volatility has dropped to about 40% from close to 200% more than a decade ago. <\/p>\n\n\n\n
Bitcoin and other cryptoassets have benefited from the election of US President Donald Trump, an industry champion whose family is building a crypto empire.<\/p>\n\n\n\n
\u201cWe actually intervene with a view of stopping the investor from doing something silly by switching,\u201d Magda Wierzycka, chief executive officer at Sygnia, which has R350 billion of assets under management, said in an interview with Bloomberg TV. <\/p>\n\n\n\n
Cryptocurrencies should form a very small portion of a diversified investment strategy instead of betting everything on Bitcoin, she said.<\/p>\n\n\n\n
For an emerging market such as South Africa, extreme movements can wipe out the life savings of individuals in a country where the per capita gross domestic product is $15,990 \u2014 that\u2019s 78% less than advanced economies.<\/p>\n\n\n\n
Wierzycka, who says that Bitcoin is overpriced, has changed her view on the digital currency and no longer sees it as speculative but as a \u201clong-term play.\u201d<\/p>\n\n\n\n
Sygnia plans to start other crypto ETFs on the Johannesburg Stock Exchange \u2014 after a previous failed attempt \u2014 once regulatory constraints are resolved, Wierzycka said.<\/p>\n\n\n\n
The Cape Town-based firm\u2019s Sygnia Life Bitcoin Plus fund has seen \u201cvery, very significant\u201d inflows and a lot of interest among Bitcoin enthusiasts, the CEO said without disclosing details on inflows.<\/p>\n\n\n\n
The firm advises investors not to put more than 5% of their \u201cliving annuity or discretionary assets in these funds,\u201d according to the fact-sheet.<\/p>\n\n\n\n
Sygnia calls investors to warn them if the company sees that investors are switching to the Bitcoin fund, the CEO said.<\/p>\n\n\n\n
\u201cThe underlying asset is highly volatile,\u201d Wierzycka said. \u201cYou need to be very sure about the messaging around it and you need to be sure that you don\u2019t make promises that you can\u2019t meet.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"
South Africa\u2019s Sygnia, which started a Bitcoin exchange-traded fund in June, says it will dissuade investors from switching all their assets into the high-risk crypto fund.<\/p>\n","protected":false},"author":59,"featured_media":783158,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[9872],"tags":[5537,15792,11885],"class_list":["post-838149","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business","tag-bitcoin","tag-magda-wierzycka","tag-sygnia"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/838149","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=838149"}],"version-history":[{"count":1,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/838149\/revisions"}],"predecessor-version":[{"id":838150,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/838149\/revisions\/838150"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/783158"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=838149"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=838149"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=838149"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}