Zerocap launches world-first crypto PPN

Yasmine Raso

Senior Journalist, Financial Newswire

11 May 2022

Australian specialist cryptocurrency investment firm, Zerocap, has unveiled the world’s inaugural Bitcoin Principal Protected Note (PPN) which protects investors against price falls while also securing any appreciations in price.

The structured note developed by Zerocap managers provides investors with their principal investment amount back at maturation regardless of the Bitcoin price and allows them to participate in 50 per cent of any Bitcoin price increase.

“The Zerocap PPN delivers Bitcoin’s diversification and non-correlation benefits against other asset classes,” Toby Chapple, Head of Trading at Zerocap, said.

“By removing downside price risk, investors can have confidence to hold Bitcoin in their portfolio for an extended period.

“The main concerns from investors are Bitcoin’s high volatility and decisions around when to enter the market. The Zerocap PPN addresses these issues with an elegant solution derived from traditional finance.”

The Zerocap PPN is also locked for a one-year term and upside is limited to 100 per cent gross appreciation in the price of Bitcoin.

“You can either wear volatility or cure it. We are excited to bring to market the world’s first PPN in the crypto space. This is another move towards smarter ways to allocate risk to this space,” Jon de Wet, Chief Investment Officer at Zerocap, said.

Ryan McCall, CEO of Zerocap, agreed that Bitcoin’s price swings and uncertainty of its future show its volatility, which structured products like the PPN can help to moderate.

“Zerocap is committed to breaking down the barriers to entry for sophisticated investors to digital assets with thoughtful and bespoke products suited to their needs, risk profile and in familiar formats,” he said.

Zerocap’s Bitcoin PPN will be available directly from the firm and through investment product platform, Stropro.

“We see a future for digital assets in investor portfolios,” Anto Joseph, CEO of Stropro, said.

“The Zerocap PPN strategy delivers that exposure and the very clever risk management features preserve capital. We think our clients will love that combination of access to digital assets, capital preservation and a great growth opportunity.”