Digital asset manager 3iQ, exchange and custodian Gemini, and platform provider BITRIA have teamed up to offer high-net-worth customers in the U.S. white-glove crypto investment accounts.
The separately managed accounts, or SMAs, carry a $100,000 minimum. They’ll be managed by 3iQ advisors on behalf of clients. Gemini will custody the assets and BITRIA provides the platform that allows clients and advisors to access the accounts.
This marks the first time 3iQ, a Toronto-based investment manager with $3.3 billion assets under management, will launch a product with its U.S. subsidiary, 3iQ Digital Assets.
The Canadian parent company, which launched in 2012, is responsible for the Bitcoin and Ethereum spot ETFs, The Bitcoin Fund (QBTC) and The Ether Fund (QETH.UN), which debuted on the Toronto Stock Exchange in 2020.
3iQ plans to offer model portfolios with Bitcoin, Ethereum, and an index that tracks the top 10 crypto assets, including tokens that are native to DeFi, a subset of crypto assets that are used for non-custodial trading and lending. But the accounts won’t support meme coins or assets that haven’t yet been approved by Gemini, such as Solana’s native SOL cryptocurrency.
“We as a platform, BITRIA, offer a subset of the assets that are available on Gemini,” Dan Eyre, BITRIA CEO and cofounder, told Decrypt. “For example, like a Dogecoin or Shiba Inu–you know, the meme type of coins–we’re not really looking to build out support for those because they’re not usually suitable in this segment anyway.”
Ultimately, it’s a better fit for clients that assets go through a rigorous due diligence process before becoming available, said Chris Matta, president of 3iQ’s U.S. subsidiary.
“Gemini has a very robust process and pipeline for adding assets,” he told Decrypt. “So as the space continues to mature and as additional assets get added, those will become available to our investors.”
Because clients will own the assets in their account, they’ll be able to use tax loss harvesting. For example, Bitcoin is currently down 20% over the last 30 days. An advisor would sell that asset, replace it with similar investments and offset future gains with the Bitcoin losses.
That’s a feature that isn’t typically available to ETF or private fund investors, although it’s not unheard of. VanEck’s recently launched Bitcoin futures ETF, VanEck Bitcoin Strategy ETF (XBTF), has been set up as a C-Corp. to allow investors to carry their losses forward and reduce taxes paid on future gains.
“We’ve seen other asset managers in the crypto space either do one-off SMAs for folks or we’ve seen some smaller startups do SMAs,” Matta said. “But this is the first time a large crypto asset manager of the size and scale of 3iQ has launched a product like this.”
The views and opinions expressed by the author are for informational purposes only and do not constitute financial, investment, or other advice.