Tokenized Asset Manager Superstate Debuts New Fund to Profit From Bitcoin, Ether ‘Carry Trade’

Blockchain-based asset management firm Superstate has introduced a new tokenized fund that will provide returns based on the popular “cash and carry” investment strategy.

The USCC token, an ERC-20 token on the Ethereum blockchain, will generate returns for its holders by buying spot bitcoin {{BTC}} and ether {{ETH}} and buying or selling short positions of equal size in BTC and ETH futures. The trade offers a delta-neutral position, profiting from the market without making any directional bets on price changes. For example, several hedge funds follow this strategy by buying spot bitcoin exchange-traded fund (ETF) shares and selling bitcoin derivatives on the Chicago Mercantile Exchange (CME).

Wrapping investment strategies like carry trades in a digital token is a new form of crypto’s red-hot tokenization trend that has put traditional investments like bonds, funds, and loans on blockchain rails. Ethena Labs’ “synthetic dollar” USDE token, which has attracted more than $3 billion in deposits in the first half of the year, also provides yield to holders via carry trades.

However, Superstate CEO Robert Leshner told CoinDesk that there are some differences in how Superstate and Ethena’s products are structured.

Ethena’s token generates returns from the funding rates of perpetual futures and passes the income on to those who lock or stake the token. Superstate, meanwhile, sells futures with specific maturity dates that provide a more predictable return and distributes the return to all token holders, Leshner said. The USCC also targets qualified, whitelisted investors to comply with U.S. securities laws and operates as a series of Delaware Trusts, an entity that is remote from Superstate in bankruptcy, he added.

“[USCC] “It’s a highly regulated product, has lower risks but lower returns,” Leshner said.

To execute the fund’s futures transactions, Superstate partners with primary brokerage firms, while spot assets are held by custody partner Anchorage Digital.

The asset manager’s new offering comes after it launched its first tokenized fund, which holds short-term U.S. Treasury bonds. The previous fund has amassed about $80 million in assets since it launched earlier this year, according to rwa.xyz data.