A Canadian cryptocurrency and blockchain investment company, First Block Capital Inc. announces their bitcoin trust, FBC Bitcoin Trust, has achieved mutual fund status in Canada. The progression will enable investors to place funds in registered accounts such as a Tax-Free Savings Account (TFSA) or Registered Retirement Savings Plan (RRSP).
FBC Bitcoin Trust is only available to the accredited investors and is available on NEO Connect, a fund distribution platform, under the ticker FBCBT. Advisors can trade the fund with the same efficiency and ease as trading ETFs. Furthermore, NEO Connect has removed the 30-day redemption clause and allows daily settlements.
The CEO and co-founder of First Block, Sean Clark, said in a prepared statement:
“At First Block, we provide investment exposure to bitcoin by removing the complicated barriers to investing directly in the cryptocurrency. As the market leader in providing investment vehicles based on blockchain and cryptocurrency in Canada, we are very happy to make our fund more accessible to the accredited investor community. In this fast-changing world, NEO is the perfect partner with whom we have seized the opportunity to grow our fund within their proven and rapidly expanding fund distribution network.”
Uncomplicated acquisition
Acquiring the fund is pretty simple, the advisors have to search for the symbol on NEO Connect with existing equities trading tools and select the number of units they want to purchase on behalf of their clients. The order placed is executed at the end of the day at net asset value without “bid” or “ask” spreads. The client accounts are automatically integrated into the resulting position.
Investors will have access to bitcoins without having to acquire, hold, or manage the physical token. Trust units are considered a qualified investment in a mutual fund trust under the Tax Act. Notably, in less than a year since its launch, the fund has surpassed 150 unitholders. According to First Block Capital, the trust been approved by the BCSC (British Columbia Securities Commission) and OSC (Ontario Securities Commission) making it the first and only product approved of its kind in Canada.
NEO Connect claims the distinction of being Canada’s sole fund distribution platform permitting prospectus and private/offering memorandum funds to be bought and redeemed the way ETFs are. Joe Schmitt, president and CEO of NEO said:
“Today, for the first time in Canada, accredited investors working with investment advisors can seamlessly take positions in bitcoin through the FBC Bitcoin Trust. As the world evolves, we are very pleased our unique fund distribution platform can help the investment community access, with ease and efficiency, an ever-expanding spectrum of new and innovative asset classes.”
Marc van der Chijs, co-founder and chief investment officer of First Block states:
“Our goal is to make investments in the digital currency asset class more accessible, and we are one step closer to achieving this goal by allowing unit holders to place units in government sponsored tax efficient vehicles, and by providing daily liquidity through NEO Connect, a fund distribution platform with a rapidly growing dealer network. With this accomplishment, we continue to push Canada forward as a world leader in regulated blockchain and cryptocurrency investment vehicles.”
The firm expects most FBC Bitcoin Trust investors will start to move units in the first month. The first Block is working with registered broker-dealer firms to manage all transfers to prepare for the fund’s launch. NEO Connect distributes 46 funds managed by three asset managers over 15 dealer networks, servicing nearly $600 million worth of assets.
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