First Block Capital Inc., a Canadian cryptocurrency and blockchain investment company, has announced that its bitcoin trust, FBC Bitcoin Trust, has achieved mutual fund status in Canada, allowing investors to place funds in registered accounts such as a Tax Free Savings Account (TFSA) or Registered Retirement Savings Plan (RRSP).
The trust is available on NEO Connect, a fund distribution platform, under the ticker FBCBT, and is available to accredited investors only. Advisors can trade the fund with the same efficiency and ease as trading ETFs.
NEO Connect allows daily settlements, removing the previous 30-day redemption clause.
Simplifying Market Exposure
“At First Block, we provide investment exposure to bitcoin by removing the complicated barriers to investing directly in the cryptocurrency,” Sean Clark, CEO and co-founder of First Block, said in a prepared statement. “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.”
The advisors 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. Once they hit “buy,” the order executes at the end of the day at net asset value, without “bid” or “ask” spreads. The resulting position automatically integrates into the client accounts.
The trust will give investors exposure to bitcoin without having to acquire, hold, or manage the actual bitcoins. Trust units are considered a qualified investment in a mutual fund trust under the Tax Act, and the fund has surpassed 150 unit holders in less than a year since its launch.
The trust has been approved by the BCSC (British Columbia Securities Commission) and OSC (Ontario Securities Commission), according to First Block Capital, and marks the first and only product approved of its kind in Canada.
“Today, for the first time in Canada, accredited investors working with investment advisors can seamlessly take positions in bitcoin through the FBC Bitcoin Trust,” said Joe Schmitt, president and CEO of NEO. “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.”
“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,” said Marc van der Chijs, co-founder and chief investment officer of First Block. “With this accomplishment, we continue to push Canada forward as a world leader in regulated blockchain and cryptocurrency investment vehicles.”
Activity Set To Begin
First Block expects most FBC Bitcoin Trust investors will start to move units in the first month. Registered broker dealer firms which First Block has worked with will manage all transfers to prepare for the fund’s launch.
NEO Connect, which 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, distributes 46 funds managed by three asset managers over 15 dealer networks, servicing nearly $600 million worth of assets.