TL;DR
- Kraken Institutional launched its first managed investment strategy for institutional clients, partnering with Bitwise.
- The strategy focuses on Bitcoin and uses covered call options to generate yield, providing a partial buffer against price declines.
- The exchange plans to expand the offering with new strategies and external managers, providing access to multiple investment opportunities.
Kraken Institutional launched its first managed investment strategy for institutional clients, partnering with Bitwise Asset Management.
The initiative, called the Bitwise Custom Yield Strategy, gives clients access to a professionally managed portfolio focused on generating yield while assets remain in Kraken’s custody. Bitwise oversees daily portfolio management, and Kraken handles custody, execution, and risk oversight, keeping the funds within its infrastructure.
The initial strategy focuses on Bitcoin and employs a covered call approach, selling call options on BTC holdings to generate additional income. This mechanism provides a partial buffer against price declines, as option income offsets losses, while capping gains during sharp rallies. The strategy includes minimal lock-up periods, giving institutional clients flexibility in liquidity management.
Kraken Plans to Launch Additional Professionally Managed Solutions
Kraken noted that this launch is the first step toward a broader suite of professionally managed solutions. The exchange plans to add new strategies and external managers, along with Kraken-managed offerings, providing access to multiple investment opportunities from a single institutional platform. All strategies undergo an internal review process and continuous oversight according to the exchange’s operational standards.
The institutional framework is designed to prevent the fragmentation many institutions currently face, where operations must be coordinated across multiple custodians, exchanges, and managers to access yield strategies with crypto assets. Kraken provides full support through qualified custody, deep liquidity, reliable execution, 24/7 client service, and a regulated ecosystem.
Ending Fragmentation
Gurpreet Oberoi, Head of Kraken Institutional, stated that the offering represents the beginning of multiple strategies within the infrastructure needed for clients to access crypto market opportunities with confidence. Gordon Grant, Head of Derivatives at Bitwise, manages the portfolio and ensures daily operational execution.
The launch of the Bitwise Custom Yield Strategy sets a standard for integrating external managers with institutional custody, giving clients immediate access to crypto yield instruments and laying the foundation for future solutions
