What to do before you invest in a wholesale crypto fund in Australia
Like any investment, investing in a crypto wholesale fund requires careful consideration and due diligence. These steps provide a helpful roadmap as you navigate your investment journey in the crypto world.
STEP 1: Check the Investment Manager is licensed. At the bottom of the Fund’s website there should be a disclaimer which includes a Corporate Authorised Representative (CAR) number and an Australian Financial Services License (AFSL) number. E.g. JellyC is a CAR of TAF Capital. The CAR number is 1293184 & TAF Capital’s AFSL is 425925.
STEP 2: Confirm that the license is legitimate. Search the ASIC register for the AFSL and the CAR. e.g. type in 425925 & enter financial services licensee. Then select search. When the license appears, select representatives – JellyC. Under JellyC PTY LTD you can see the CAR number of 001293184. This confirms JellyC is a CAR of JellyC.
STEP 3: Confirm the Fund is registered to the Licensee. Search the Australian Business Register e.g. type in the Bluebottle Fund and press search. You will see results for The Trustee for Bluebottle Fund.
STEP 4: Contact the Trustee & confirm the Fund is associated with their license. Go to the Trustee’s website e.g. TAF Capital and find the contact details. Contact the Trustee & wait for confirmation that the Fund is associated with an Investment Manager under the Trustee’s AFSL.
STEP 5: Meet the Investment Management Team. Review the Fund Pitch & Offer documents. If there is anything you are unsure about, seek independent advice. Check the terms and do your research. If you need more information, ask to see the Due Diligence Questionnaire (DDQ).
STEP 6: Once you have decided to proceed, check the subscription is in AUD & the bank account is held in Australia. The account name should read – trustee name ATF fund name. E.g. TAF Capital PTY LTD ATF Bluebottle Fund. This is particularly important. Call the Trustee over the phone to confirm the bank details. The Trustee should send confirmation of the AUD being received.
STEP 7: The Trustee will ask you to provide KYC (know your client) information as well as a wholesale certificate. The wholesale certificate will need to be completed by a Certified Accountant.
STEP 8: The Trustee will then send a NAV (Net Asset Value) statement between 1 & 20 days after the beginning of the investment period. E.g. if the Fund has a monthly NAV, the unit value will be set on the last day of the month. The statement converting AUD to units will be sent 1-20 days after that.
STEP 9: The Investment Manager should send periodical newsletters that correspond to the reporting period of the Fund. E.g. monthly liquidity should see monthly newsletters.
STEP 10: The Trustee will send periodical NAV statements. E.g. monthly liquidity should see monthly NAV statements. By following these steps, investors can ensure they are dealing with a legitimate and authorized investment manager, and that their investment is secure and compliant with Australian regulation