Last update: 17.09.2024 08:31
With finpension Bitcoin, you have been able to invest 100% of your pillar 3a in Bitcoin since January 2024. Cryptocurrencies have been possible with finpension since 2021. We check out the offer. Discover everything you need to know about finpension bitcoin in the article.
finpension Bitcoin: How can I invest in cryptocurrencies in pillar 3a?
The provider finpension is the Swiss pillar 3a crypto pioneer. Since December 2021, they have made it possible to invest in cryptos in pillar 3a with an individual investment strategy. You can invest up to 5% of your 3a assets in the Crypto Market Index Fund. In this way, finpension wants to demonstrate its claim to innovation in the pension market for crypto investments in pillar 3a.
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How does finpension bitcoin work?
In principle, finpension does not invest your pillar 3a money in cryptocurrencies unless you decide to do so. And this is how it works: As part of an individual strategy, you choose either the Crypto Market Index Fund or the iShares Bitcoin Trust ETF as an investment in the “alternative investment” category. The units are limited to a maximum of 5 % of your personal 3a assets. This makes the crypto portion an addition to the investment mix. Neither gold nor crypto assets are part of the investment strategies by default.
What is the Crypto Market Index Fund?
The Crypto Market Index Fund is a product of Crypto Finance AG. It invests primarily in crypto assets, i.e. securities based on blockchain or distributed ledger technology. The aim of the fund is to passively replicate the SIX Crypto Market Index 10 (CMI10) of SIX Swiss Exchange Ltd.
The aim of the Crypto Market Index 10 is to reliably measure the performance of the largest and most liquid crypto assets and tokens and to provide a benchmark for this asset class. Accordingly, the fund invests in a portfolio of 10 large crypto assets and weights them according to their market value. The units are rebalanced every quarter in order to track the market performance of the crypto assets. The base currency of the Crypto Market Index Fund is the US dollar and it is available in the trading currencies US dollar (ISIN CH1140916805, Valor 114091680) and Swiss franc (ISIN CH1140916755, Valor 114091675).
If we take a closer look at the top 10 positions, you will quickly notice a cluster risk . This is because the two largest positions in the fund, Bitcoin (~70%) and Ethereum (~22%), together make up 82% of the index (as at March 31, 2024). With this product, you therefore predominantly track the performance of Bitcoin and Ethereum.
Who is Crypto Finance AG?
The Crypto Finance Group, with offices in Zurich and Zug, was founded in 2017. It offers products and services for crypto and blockchain technology for professional and institutional investors. Since its foundation, the group has been recognized several times, including in the Top 50 Blockchain Companies of the Zug Crypto Valley, the Top 100 Swiss Startups and as the winner of the “Swiss FinTech Awards 2019”.
Investing cryptocurrencies with finpension: what does it cost?
To include cryptocurrencies in your pension with finpension, you can choose between two products: either the Crypto Market Index Fund or the iShares Bitcoin Trust ETF.
The Crypto Market Fund is quite expensive with a Total Expense Ratio (TER) of 1.6 % per year. The costs are therefore much higher than for the index funds that finpension otherwise uses. The costs of standard products are between 0 – 0.04 %. In comparison, crypto investments are around 50 times more expensive. This is also a reason why you choose this product individually. Not everyone wants highly volatile investments in their portfolio, which also significantly increase the expense ratio. For example, a 5 % crypto share in the portfolio increases your total expense ratio by around 0.1 %.
The iShares Bitcoin Trust ETF, on the other hand, is a bargain. It costs you just 0.25 % TER per year. I have described the product in this article.
Summary finpension Bitcoin
finpension allows you to participate in the changes in value of cryptocurrencies in two ways with a portfolio share of up to 5%. Either you invest 100% in Bitcoin, in which case you choose the more cost-effective iShares Bitcoin Trust ETF (TER 0.25%). Or you can invest in the 10 largest cryptocurrencies by market capitalization – then, in addition to 70% Bitcoin, you also have 22% Ethereum and a few other altcoins for annual fees of 1.6%.
Open pillar 3a now (with or without cryptocurrencies) with a CHF 25 bonus
Use the code SMLUTQ for your welcome bonus when opening an account. You will receive this as a fee credit if you deposit or transfer at least CHF 1,000 within 12 months. And you save for life with equity ratios of 60% or more thanks to very low fees.
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