Key facts
- Brazil's OranjeBTC is launching a new ETF called DIGY11.
- The ETF will initially invest 95% in Strategy's STRC preferred shares and 5% in Strive's SATA.
- STRC and SATA currently offer yields of 12.5% and 13.1% respectively.
- DIGY11 aims for monthly income distributions equivalent to Brazil's CDI rate plus 3-5 percentage points, net of costs.
- The fund will hedge dollar exposure using monthly FX forwards.
- Trading is anticipated to begin in early September with a 0.90% management fee.
Brazil's largest bitcoin treasury firm, OranjeBTC, is preparing to launch a new exchange-traded fund (ETF) named DIGY11. The fund is designed to provide monthly income distributions and will initially allocate 95% of its portfolio to Strategy's STRC preferred shares and the remaining 5% to Strive's SATA preferred shares. Both STRC and SATA currently offer attractive yields, with STRC at 12.5% and SATA at 13.1%, derived from their respective companies' bitcoin holdings which remain on their balance sheets.
DIGY11 aims to distribute income equivalent to Brazil's risk-free Interbank Deposit Certificate (CDI) rate, currently around 14.15%, plus an additional 3-5 percentage points, after accounting for an estimated total cost of 1.30%. OranjeBTC Director of Strategy and Research Sam Callahan noted that these estimated returns depend on preferred share distributions and interest rate differentials between Brazil and the U.S., and do not guarantee future performance or changes in the ETF's share price.
The ETF will be traded on Brazil's B3 exchange in Brazilian reals and will hedge its U.S. dollar exposure through monthly foreign-exchange forwards. OranjeBTC will charge a 0.90% management fee, with a portion going to the firm under a consulting agreement. 3R Investimentos will manage the portfolio, and MarketVector will maintain the benchmark index. Trading for DIGY11 is expected to commence in early September.