Bitcoin-focused trading fund is being launched by hedge fund BXB Capital

Quick Take

  • BXB Capital is launching a bitcoin-focused trading fund in July, Fortune reported.
  • The fund already has 400 BTC in commitments from investors and is looking to raise up to 1,000 BTC.

Crypto hedge fund BXB Capital or Block by Block Capital is launching a bitcoin-focused trading fund in July.

The fund, which was co-founded by former Binance Korea co-founders J.J. Petersen and Alex Friedberg, already has 400 bitcoin (worth around $10 million at current prices) in commitments and plans to raise up to 1,000 bitcoin (nearly $27 million), Petersen told Fortune in an interview published Monday. The fund is raising capital exclusively in bitcoin and will also only trade in bitcoin and provide returns in bitcoin.

"There are very few funds that look at bitcoin as the asset you want to make more of," Petersen told Fortune. "People are starting to change their framework and are no longer trying to just acquire more wealth in USD or fiat."

Petersen said that many crypto native investors do not want to hold more dollars, so the new fund gives them a chance to earn bitcoin without getting involved in lending or yield products.

"You basically need to earn [more] dollars to outpace inflation," he said. "If you earn more Bitcoin, you just own your token, so you increase your total percentage of the circulating supply permanently."

What is BXB Capital?

Petersen and Friedberg co-founded BXB Capital in 2017 as a proprietary trading firm. The firm's initial mandate was trading so-called "kimchi premium," which involved taking advantage of price differences between bitcoin in South Korea and other markets, a tactic popularized by now bankrupt crypto firms Three Arrows Capital and Sam Bankman-Fried's Alameda Research. Over the years, BXB Capital's scope expanded to include other opportunistic trading strategies.

Petersen and Friedberg had also launched the South Korean won-backed stablecoin KRWb as part of their company BxB Inc. In 2020, BxB Inc. was acquired by Binance and rolled into a joint venture for the launch of their Binance branded stablecoin, BKRW, and Binance Korea, according to Petersen and Friedberg's LinkedIn profiles — where they are mentioned as co-founders of Binance Korea. Binance Korea, however, shut down less than a year after being in operation due to tight liquidity and low transaction volumes.

The new fund comes as bitcoin is seen as a more popular safe haven than the U.S. dollar, according to Bloomberg's Markets Live Pulse survey conducted last week. The possibility of U.S. debt default looms larger than ever before, posing a significant threat to global markets. Earlier this month, Tether, the issuer of the world's largest stablecoin USDT, said it will regularly invest up to 15% of its profits in bitcoin as it shifts its reserves towards crypto and away from U.S. government debt.

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