DigitalX Bitcoin ETF (BTXX)

Bitcoin and other digital assets are new and novel forms of technology. This means that purchasing and storing Bitcoin can be risky at times, due to issues like exchange quality, cybersecurity, custody and loss of private keys. DigitalX is Australia’s most experienced, and only ASX-listed digital asset investment manager, and we are experts in navigating the operational risks that come along with buying and storing Bitcoin.

BTXX provides direct exposure to Bitcoin, with DigitalX’s experience and management. Retail investors can buy BTXX using their everyday brokerage account.

The Fund aims to hold at least 80% of its digital currency in cold storage. This means that the private key shards are held in an offline digital hardware storage device that is stored in physical vaults in geographically diverse locations, and where each vault is secured by multiple levels of physical and biometric security. This means that private keys are not held in full until there is a transaction signing where the key is reconstituted. While these arrangements are intended to minimise the risk of the private keys being lost, destroyed or stolen, there is no guarantee that these events will not occur.

The Fund’s assets are held in custody with Coinbase Custody Trust Company LLC and also in the Coinbase trading account. The Fund will be trading Bitcoin with the Coinbase trading account (in relation to creations and redemptions of Bitcoin Interests) on behalf of the Fund. Coinbase is licensed by the State of New York as a qualified custodian of digital assets and provide segregated and auditable custody accounts. Coinbase is subjected to the same capital reserve requirements and compliance standards of a traditional financial institution that is regulated as a New York State Trust Company. Coinbase maintains SOC 1 Type II and SOC 2 Type II audits by Deloitte & Touche. The Fund will aim to keep at least 80% of its Bitcoin holdings in cold storage. The Responsible Entity may use other custodians for the Fund’s Bitcoin if it deems it prudent to mitigate risk.