Blockstream launches two Bitcoin investment funds

Blockchain development firm Blockstream has launched two institutional investment funds that offer direct exposure to the company's Bitcoin ecosystem, allowing investors to earn a return on Bitcoin-backed loans and other income streams.

In the year In a January 23 announcement, Blockstream announced its new asset management business, introducing the Blockstream Income Fund and the Blockstream Alpha Fund, which are set to launch in the first quarter of this year.

The Blockchain Income Fund is designed to pay off a US dollar-denominated product by lending with BTC (BTC) collateral. The fund focuses on loans ranging from $100,000 to $5 million.

The Alpha Fund focuses on portfolio growth, giving investors exposure to “infrastructure-based revenue streams such as Lightning Network node operations.” It is considered an actively managed fund, which typically carries higher fees.

Blockstream joins companies such as Greyscale, Pantera and Galaxy Digital in offering crypto-focused investment funds with varying degrees of exposure to the industry. Cointelegraph recently reported that digital asset exchange Crypto.com has also launched an institutional investment platform.

But the biggest driver of institutional investment is exchange-traded funds (ETFs). Net assets held by U.S. Bitcoin ETFs approached $120 billion as of Jan. 10, according to crypto analytics firm Dunn.

Related: Bitcoin investment ‘material impact' draws attention of pension funds

Trump's reason

Analysts believe that the recent election of US President Donald Trump is a critical turning point for the crypto industry. If positive regulations are put in place, the growth of institutional Bitcoin and other digital assets is expected.

VanEck Associate Product Manager Dennis Zinoviev said key government appointments, such as the appointment of Paul Atkins to lead the US Securities and Exchange Commission, “could benefit bitcoin by increasing transparency for institutional investors.”

However, Zinoviev warned that “greater adoption and legalization may come.” [with] Heightened scrutiny” especially around tax reforms and crypto reporting requirements.

In the meantime, the SEC has established a crypto task force led by industry attorney Hester Pearce that aims to develop a clearer regulatory framework for digital assets.

“The focus of the task force is to help the Commission develop clear regulatory frameworks, provide concrete ways to register, develop prudent disclosure frameworks, and equitably deploy enforcement resources,” the SEC said in a statement.

Related: BOA CEO says banks eager to get into crypto if regulators allow it.