25 July 2017
Carey Olsen and JTC Group support launch of first ever crypto-denominated fund
Carey Olsen, in partnership with JTC Group and investment manager Global Advisors Holdings Limited (“Global Advisors”), has confirmed the provision of its award winning legal services to what is believed to be the world's first regulated, crypto-denominated fund.
CoinShares Fund I, which launched on 23 June 2017, is a self-managed fund and will receive investment exclusively in Ether, the ‘crypto-fuel’ which runs the Ethereum platform. The fund will then trade cryptocurrencies and other tokens (or ‘coins’), including participating in selected Initial Coin Offerings (ICOs). ICOs are the crypto-alternative to the Linux or Mozilla Foundations, and represent a form of capital raising increasingly utilised by fintehc entrepreneurs in the crypto arena, regularly inviting comparison with traditional venture capital or crowdfunding, The fund will be regulated under Jersey's recently introduced Private Fund Regime. This regime is designed specifically for funds operating with a small number of very sophisticated investors, with the proportionate regulatory environment offering an impressive speed to market.
Legal advice in establishing the fund was provided by Carey Olsen in Jersey with support from Chadbourne & Parke LLP in New York, while JTC will provide a range of ongoing services including: directors, company secretary, fund administration, fund accounting and investor reporting.
James Mulholland led the Carey Olsen team, assisted by Counsel Chris Griffin. Chris Griffin commented: “It was great to work with Global Advisors on this fund launch against a tight timetable – the fund shows both Carey Olsen’s growing fintech strength and Jersey regulator’s practical approach to investment funds launching in this pioneering asset class worth US$21billion.”
William Byrne, Group General Counsel at JTC, said: "We are delighted to have been selected by Global Advisors as partners to support this unique new fund, which is a genuine first. Crypto-denominated funds are an exciting new alternative asset class and, as an innovative independent firm, we have worked hard to establish our market-leading credentials in this area. We are particularly pleased to be providing our new crypto portfolio valuation system, which operates via multiple exchanges, taking live pricing and providing the ability to trade on a T0 basis."
Jean-Marie Mognetti, Co-Principal of Global Advisors Holdings Limited and Director of the GP, added: "The amount of diligence required to structure this ICO and ‘Alt Coin’ fund, a Private fund capable of investing in this emerging digital asset class, was both complex and ground-breaking. Much credit is due to our legal and fund administration partners who worked diligently to provide the most robust, compliant structure possible based on the current regulatory environment."