Swiss digital asset bank Sygnum has launched an Ethereum fund that targets annual returns of 8% to 10% in ETH after fees. The fund combines staking with options, arbitrage and derivatives strategies, and the target is not a guaranteed payout.
Sygnum opened its ETH Alpha Fund SP to investors on November 2, targeting returns of 8% to 10% a year in ETH. The fund pairs Ethereum staking with options trading, arbitrage and derivatives strategies. It is open to qualified investors in approved markets, including Switzerland.
Returns are measured in ETH, not dollars
The fund records its gains and losses in ETH, and the target is calculated after fees. However, the return remains an investment objective, and investors still face changes in Ethereum's market price.
Sygnum estimates that conventional ETH staking currently generates annual rewards of approximately 2% to 3%. The new product aims higher by adding trading strategies run by specialist investment firms.
Markus Hämmerli, Sygnum's head of asset management and the fund's lead, said: "Institutions that hold ETH for the long term increasingly think in ETH, not dollars."
Staking, options and market-neutral trading
Sygnum starts with native Ethereum staking, then adds options premiums, arbitrage between trading venues and income from funding rates and other derivatives positions. The bank describes these approaches as market-neutral because their intended returns do not depend primarily on Ethereum prices rising.
Still, the fund stays exposed to ETH price movements. A drop in ETH's dollar value could reduce an investor's holdings when measured in dollars, even if the fund earns additional ETH.
Sygnum's fund information sets the minimum investment at $100,000 or its equivalent in ETH. Subscriptions take place monthly with two business days' notice, while redemptions require 15 calendar days' notice. The product carries risks tied to derivatives, staking, liquidity, counterparties and trading systems. Its use of leverage in some strategies may increase losses in volatile markets.
Collateral stays at the bank
The fund uses Sygnum Protect, the bank's off-exchange custody service. Collateral remains with Sygnum while investment managers execute strategies through supported trading venues. The structure is intended to reduce the client collateral that exchanges hold directly, though it does not eliminate trading or counterparty risks.
The launch follows a similar fund for Bitcoin investors. Sygnum introduced the BTC Alpha Fund in October 2025, partnering with Starboard Digital, with the same 8% to 10% target in Bitcoin after fees.
Source: crypto.news
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