With the collapse of Bitcoin from more than R250 000 to
about R70 000 currently, the hype around crypto-currencies has largely died
down. It usually takes a wipeout like this for people to understand exactly
what is meant by a risky investment.
However, pundits argue that there is a future for
cryptocurrencies and, now that much of the speculative activity has been
removed from crypto markets, it could be time to start putting a bit of “fear
of missing out” money into this investment space.
One of the challenges with cryptocurrencies is which one to
bet on. While Bitcoin is the most well known, there are more than 1 600
available, including the more familiar Ethereum and Ripple.
A new digital assets platform has been created by financial
technology entrepreneurs Sean Sanders and Louis Buys. The aim of their platform
Revix is to create an ETF-like investment structure for cryptocurrencies. They
have put together a bundle of the top 10 most traded cryptocurrencies, which
effectively make up 80% of the cryptocurrency market.
Sanders says the benefit of following a bundled approach is
that it reduces risk through diversification. What’s also interesting to note
is that, between January 1 2016 and December 31 last year, the Revix Top 10
Crypto Bundle would have outperformed an investment in Bitcoin alone by 109% on
an annualised basis.
Diversification also provides some protection against the
failure of a single cryptocurrency. As an investor, you still own the actual
cryptocurrency, but Revix offers a full custody solution to keep the assets
Buys says that they are able to source the best prices
because they are able to purchase cryptocurrencies across global platforms.
Revix uses proprietary technology to plug into global exchanges, and a smart
pricing algorithm seeks out the best available pricing for investors on
“Typically, by connecting with global, liquid markets and
using technology, we can get better prices than what has otherwise been
available to local investors,” says Buys.
Revix has been funded by JSE-listed investment group
Sabvest, which will provide some peace of mind to investors who are wary of
investing on virtual platforms.
Although cryptocurrencies are currently unregulated, Sanders
says they have engaged with regulators and will ensure that the product
complies with future regulatory changes.
However, this remains a high-risk investment as
cryptocurrencies are extremely volatile and are currently driven by sentiment
rather than fundamental factors. Any money invested should be considered to be
“burn money” – this is certainly not the place for your child’s education fund.
The minimum investment is R500 and can be made on Revix’s web-based
platform revix.com. The app for Android and iOS is still in development. The
platform uses images of your ID or passport and selfies to verify your
Monthly rebalancing fee: 0.17% a month or 2.04% a year.
Transaction fees: Buying or selling incurs a 1% Revix
Withdrawal fees: An amount of R30 is charged on withdrawals.
For amounts of more than R200 000, there is a 0.05% withdrawal fee.
There are no performance fees and no storage fees
- The top 10 bundle is a diversified and equally weighted
bundle of the 10 most prominent cryptocurrencies.
- The payment bundle is an equally weighted bundle of the
five largest payment-focused cryptocurrencies. These blockchain technologies
are making payments faster, cheaper and borderless.
- The platform bundle is an equally weighted bundle of the
five largest platform cryptocurrencies that have been developed to improve many
of the current inefficient systems, processes and governance structures.
- The privacy bundle is an equally weighted bundle of the
top three privacy-focused cryptocurrencies. These blockchain technologies aim
to protect your right to privacy online.