Blockchain development firm Blockstream has introduced two institutional investment funds aimed at providing direct exposure to its Bitcoin ecosystem. The funds, announced on January 23, are designed to offer investors opportunities to earn yields through Bitcoin-backed loans and other infrastructure-based revenue streams.
Introducing Blockstream Income Fund and Alpha Fund
Blockstream’s new asset management business has unveiled the Blockstream Income Fund and the Blockstream Alpha Fund, both set to launch in the first quarter of the year.
The Blockstream Income Fund is tailored for investors seeking US dollar-denominated yields. It achieves this by lending against Bitcoin collateral sourced from Blockstream’s network of Bitcoin-focused startups and businesses. Loans facilitated by the fund range between $100,000 and $5 million.
On the other hand, the Blockstream Alpha Fund focuses on portfolio growth by providing exposure to revenue streams from Bitcoin infrastructure, such as operations within the Lightning Network. As an actively managed fund, it targets infrastructure-based opportunities but carries higher management fees.
With these new funds, Blockstream joins the ranks of industry players like Grayscale, Pantera, and Galaxy Digital, all of which offer institutional-grade crypto investment products. Crypto.com has also entered the space, recently launching its own institutional investment platform.
The Rise of Institutional Bitcoin Investments
While Blockstream’s funds represent a new approach, exchange-traded funds (ETFs) remain the leading driver of institutional Bitcoin investments. As of January 10, US Bitcoin ETFs held nearly $120 billion in net assets, according to data from crypto analytics platform Dune.
