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SA cryptocurrency investment platform Bitfund has had “hundreds” of investors sign up since its launch yesterday claims one of its founders, Josh Miltz.
The founders of the Joburg-based startup claim that the new platform gives investors exposure to index portfolios of more than 20 of the largest cryptocurrencies. “We think a lot of people are excited by the technology,” Miltz told Ventureburn today.
However, Miltz — a software engineer, who founded the startup with three former school friends last year — declined to say how much the platform was able to raise in funding from three local entrepreneurs last year.
He could say only that the platform received a “significant” amount in seed funding late last year.
A new SA cryptocurrency investment platform Bitfund has had hundreds of investors sign up since its launch yesterday claims one of its founders
The startup’s three other founders are actuary Jonathon Ferrer, accountant Bradley Goldman, and lawyer Dean Joffe.
The funding came from Greymatter Thinking Consultancy founder Richard Cohen, LSD Information Technology founder Stefan Lesicnik and En-novate founder Natan Pollock.
While Miltz declined to say how much had been raised or what percentage stake in the business the three had taken, he confirmed that the four founders hold the majority stake in the startup.
‘Single points of entry for investors’
What then is the platform’s claim to fame? BitFund, claim the founders, offers investors an easy-to-use, single point of entry to structure a portfolio that includes cryptocurrencies such as Bitcoin, Ethereum, Ripple, Litecoin, IOTA, EOS, Cardano, Stellar, NEO and others.
Miltz said the launch follows testing that the startup ran on the platform involving about 100 users ranging from former colleagues to family members and friends. However, he said for “security reasons” he could not disclose the amount that is currently under management.
BitFund has created three pre-specified BitFund portfolios and charges a flat annual management fee of 2.4%, and a one percent exit fee. There is a minimum investment amount of R1000.
The company manages the purchase, sale and safe transfer of the cryptocurrencies within the different portfolios and securely stores these locally off the international exchanges in hardware digital wallets which are in turn stored in physical vaults to significantly reduce the threat from online hackers.
‘No need to register with FSB, act’
Miltz said there is no need for the fund, to be registered with the Financial Services Board (FSB) as a financial service board, as the authority does not define cryptocurrency as a financial product.
He added that neither is it a requirement that the fund comply with the Collective Investment Schemes Control Act, as unlike in traditional financial products the fund’s investors retain the portfolios themselves. Investors merely use the platform to run their own portfolio, he pointed out.
However, despite this he said his team has been working with lawyers to ensure that clients and the platform remain “above board” with things regards to compliance issues such as tax and exchange control.
Furthermore, he said the startup is working with lawyers to ensure that the platform is ready in the eventuality that cryptocurrency platforms will need to comply with the FSB and the Collective Investment Schemes Control Act.
Featured image: Bitfund founders Jonathon Ferrer, Josh Miltz and Bradley Goldman (Dean Joffe is not pictured) (Supplied)