Cryptocurrency as a way of investment has become quite popular on a global scale. However, investors are often clueless about which digital asset to back. Currently, there are hundreds of listings on crypto exchanges, making it overwhelming for investors to select the right assets. The lack of credible information, transparency, and reliable index products further exacerbates this problem.
Many existing solutions in the market attempt to address this issue through thematic baskets or managed portfolios. However, they often fall short in terms of credibility, product design, and user familiarity.
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BitSave is a crypto mutual fund platform that is the only retail crypto platform licensed by Bloomberg to build mutual funds linked to Bloomberg’s Crypto Indexes. Their first offering is an index fund based on Bloomberg Galaxy Crypto Index (BGCI).
The Tech Panda spoke to Zakhil Suresh, CEO of BitSave, about how they are addressing the risk of asset selection and capital loss faced by long-term crypto investors.
With the highly volatile nature of the crypto asset market, more than 50% of crypto assets drop off from the top 25 list every market cycle, and over 90% of crypto projects ultimately fail in the long run. This poses a significant challenge for investors looking to build a diversified and profitable crypto portfolio
“The problem we are addressing is the risk of asset selection and capital loss faced by long-term crypto investors. With the highly volatile nature of the crypto asset market, more than 50% of crypto assets drop off from the top 25 list every market cycle, and over 90% of crypto projects ultimately fail in the long run. This poses a significant challenge for investors looking to build a diversified and profitable crypto portfolio.
“This problem affects a substantial number of individuals and companies in the crypto industry, with more than 50 million crypto investors worldwide. The scale of the problem is significant, as it hampers the potential growth and adoption of crypto as an investment asset class. While traditional finance has successfully solved the problem of asset selection through index funds, the crypto market lacks a reliable and widely accepted equivalent. Existing solutions in the crypto space have not been able to provide a comprehensive and trustworthy approach to address this challenge,” he says.
What They Do
BitSave is a comprehensive crypto investment platform offering passive index and structured products. It is designed to solve the problem of asset selection and capital loss for long-term crypto investors. The platform functions by offering a range of index products based on reputable and trusted crypto asset indices, such as Bloomberg’s Crypto Index BGCI.
The BitSave Bloomberg Crypto Index Fund is BitSave’s flagship product designed to provide investors with a seamless and reliable way to gain exposure to the cryptocurrency market. Leveraging the trusted Bloomberg brand and the expertise of BitSave, this fund offers a unique opportunity for both seasoned crypto enthusiasts and traditional investors looking to explore the digital asset space.
Inspiration
The BitSave team, which comprises of Sajal Sharma (CTO) and Asif Kattakath (COO), discovered Bitcoin and cryptocurrency in 2014 and have been actively trading the markets since 2017.
“We have essentially done three things since then, 1. Helping people buy and sell crypto. 2. Advising people what to buy and when to buy, and 3. Managing portfolios. So, we always knew there is a market out there for structure crypto products,” says Suresh.
As the crypto ecosystem expanded, the trio also noticed a significant challenge emerging.
“The sheer complexity of the crypto landscape and the absence of credible information made it increasingly difficult for the average investor to navigate and make sound investment choices,” he adds.
We wanted to gain insights into the pain points people experienced when investing in crypto. Astonishingly, over 80% of them expressed a keen interest in investing in passive crypto products. That is what inspired us to start building BitSave
Moreover, the lack of oversight in the industry resulted in some well-known players mishandling user funds.
“Recognising this gap, we saw an opportunity to create a transparent platform offering easy-to-understand investment products,” he explains.
Consequently, in 2022, the team spoke with more than 200 individuals from diverse backgrounds.
“We wanted to gain insights into the pain points people experienced when investing in crypto. Astonishingly, over 80% of them expressed a keen interest in investing in passive crypto products. That is what inspired us to start building BitSave,” he reminisces.
The BitSave USP
The experience that the BitSave team brings to the table is a significant one, comprising a seasoned team with 30+ years of combined relevant experience ensuring efficient fund management and strong decision-making. Some of the core team members were founding members of Koinex, India’s largest crypto exchange during 2017-19.
Secondly, Suresh informs that BitSave is setting new standards in transparency through Proof-of-Reserves and On-Chain Accounting.
Every time our clients buy or sell BitSave product units, an equivalent amount of tokens is minted or burned on the blockchain, ensuring a clear representation of our balance sheet. Our clients can verify everything directly on the blockchain, giving them complete transparency over what we hold on their behalf
“Every time our clients buy or sell BitSave product units, an equivalent amount of tokens is minted or burned on the blockchain, ensuring a clear representation of our balance sheet. Our clients can verify everything directly on the blockchain, giving them complete transparency over what we hold on their behalf,” he explains.
Thirdly, the company is the first retail crypto platform to design a crypto retail product that closely resembles traditional mutual funds with NAV reporting and 100% transparency of holdings. The platform is also the first retail crypto platform to offering an index fund linked to Bloomberg Galaxy Crypto Index.
“We will soon start offering our clients can option to hedge their crypto portfolios with real-world-assets like gold and bonds,” he informs.
Growth Story
Currently, the platform’s Assets Under Management (AUM) stand at US$$30,000. But what is gratifying, says Suresh, is that approximately 35% of their clients are first time crypto investors.
“This serves as a resounding validation of our core belief that simplifying the crypto product itself can play a pivotal role in expanding the crypto market ecosystem,” he says with pride.
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“Building during the bear market has been extremely challenging. But one thing we are very clear about at BitSave is that we can’t create the demand for crypto. It has to come organically, and our primary objective is to become the preferred choice for individuals seeking crypto exposure within their portfolios,” he adds.
Future Plans
BitSave’s current version includes only INR to crypto gateway. Thus, its foremost priority is to integrate additional fiat gateways, facilitating easy access to its products for clients worldwide.
“We are also working on expanding our range of investment products, each tailored to different risk profiles. Recognising that individuals have varying risk appetites, our aim is to offer a range of options that align with their preferences,” he concludes.
