BaFin-approved German hybrid fund combines crypto

BaFin-approved German hybrid fund combines crypto, real estate

As the cryptocurrency space continues to grow and expand, the latest venture by a German firm has been to invest in what it called a hybrid cryptocurrency and real estate fund. Munich-based BITREAL Capital GmBH has been granted authorization by the German Financial Supervisory Authority (BaFin) to market this fund—an intriguing development in the current market scenario, Finance Magnates reported.

Although cryptocurrency values have taken a beating in the last three months, there appears to be a recovery on the horizon with most of the major currencies soaring by well over 100% in April from their lows for the year. However, the real estate market has not registered any form of correction and is in a booming phase with values in the top city centres continuing to soar. The idea of a combined fund is quite interesting as it attempts to ride the wave of cryptocurrencies which are expected to continue rising in the next years together with real estate, which is always seen as a safe investment.

Founded in 2017, BITREAL is looking to specialise in what are termed special alternative investment funds (AIFs). According to the company, the BITREAL Real Estate Blockchain Opportunities Fund 1 (BREBCO 1) will be the first fund of its kind to combine cryptocurrencies and real estate—a combination that should see explosive growth in the short to medium term.

BREBCO’s strategy is to invest in the cryptocurrency market through blockchain technology and strategic investments in high market cap coins that are relatively stable although volatility still remains an issue. It also plans to invest in commercial real estate to generate an impressive 15% equity return annually. These real estate purchases are to be partially funded by bank loans from across 10 top economic regions in Germany. The fund is aiming for a seven-year lifetime and an equity volume of around $49 million.

The fund also offers to opportunity to investors to use cryptocurrencies such as BTC and Ethereum to purchase shares in the fund. They will also be able to withdraw their holdings in fiat or in any listed digital currency. The minimum investment volume for BREBCO 1 is set at €500,000 (US$612,000).

Boris Hardi, managing partner of BITREAL Capital GmbH, said BREBCO 1 is the answer to questions “as to how or in which virtual currencies, coins, and tokens can be sensibly invested in or how to take part in the blockchain technology market potential without the high volatility and risk of total loss.”

The BaFin has also provided clarity for ICOs after receiving a substantial number of inquiries regarding the legality of such offers. It said that ICO operators in Germany will be required to check exactly whether a regulated instrument or security is being dealt with in order to fulfill potential legal requirements without any loopholes.

Note: Tokens on the Bitcoin Core (segwit) Chain are Referred to as BTC coins. Bitcoin Cash (BCH) is today the only Bitcoin implementation that follows Satoshi Nakamoto’s original whitepaper for Peer to Peer Electronic Cash. Bitcoin BCH is the only major public blockchain that maintains the original vision for Bitcoin as fast, frictionless, electronic cash.
Financial regulator shuts down German crypto brokerage

Financial regulator shuts down German crypto brokerage

Germany’s financial regulator, the German Financial Supervisory Authority, has issued an order shutting down the financial brokerage arm of a Berlin-based cryptocurrency exchange in a move that could indicate the regulator adopting a tougher stance on cryptocurrency businesses in the country.

BaFin, which is tasked with overseeing markets and the broader financial system in Germany, decreed that Crypto.exchange GmbH must immediately cease acting as a financial broker, following announcements made on one of the company’s websites.

On its btc-now.de site, Crypto.exchange offered to sell bitcoins for euros, with the firm then selling the cryptocurrency on exchanges. The company was claiming to forward money to its customers within 30 minutes, as part of this alleged brokerage process, according to the regulator.

BaFin said Crypto.exchange is not licensed to operate this type of service, and concerns were raised initially when several customers reported that they had failed to receive payment as part of their transactions.

According to a translated statement from the regulator, Crypto.exchange has gone outside of the terms of their licensing in operating a financial commission business, a regulated activity in its own right.

“The company advertised on the Internet – including on the site www.btc-now.de – to exchange Bitcoin in euros. It claimed to have been audited by the BaFin. Investors should transfer their bitcoins to the company, which in turn wanted to sell them on a stock exchange. The purchase price achieved there should be transferred to the investors within 30 minutes,” the regulator said. “As a result, Crypto.exchange GmbH operates a financial commission business. The BaFin expressly understood that the company operates against its own advertising, and without the required authorization by the BaFin.”

The move comes as only the latest steps taken by the German regulator to tighten up the cryptocurrency sector there.

Back in April 2017, the regulator took action against payment processors involved in the notorious OneCoin cryptocurrency, a project that has come in from strong criticism from analysts and regulators alike.

In the weeks following a decision by Italian authorities to fine OneCoin in the order of €2.6 million ($3.2 million), the BaFin ordered connected companies in Germany to ‘dismantle’ the parts of their business that dealt with OneCoin at the time.

Note: Tokens in the SegWit chain are referred to as SegWit1X (BTC) and SegWit Gold (SWG) and are no longer Bitcoin. Bitcoin Cash (BCH) is the only true  Bitcoin as intended by the original Satoshi white paper.  Bitcoin BCH is the only public block chain that offers safe and cheap microtransactions.