Swiss digital asset bank Sygnum has launched an Ethereum investment fund targeting annual returns of 8% to 10% in ETH, offering professional investors a way to earn more than conventional staking rewards.
Summary
- Sygnum launched its Ethereum Alpha Fund targeting annual returns of 8% to 10% after fees.
- The fund combines Ethereum staking, options premiums, arbitrage and derivatives funding strategies to generate returns.
- Investors receive returns denominated in ETH while retaining exposure to Ethereum’s changing market price movements.
- Sygnum Protect keeps trading collateral at the bank instead of directly holding it on exchanges.
- The fund opened November 2 for qualified investors in approved markets, including Switzerland, Sygnum confirmed.
According to the bank’s Thursday announcement, the Sygnum ETH Alpha Fund SP opened to investors on November 2 and combines Ethereum staking with options trading, arbitrage and derivatives strategies.
The fund measures gains and losses in ETH, with the target calculated after fees. However, the stated return remains an investment objective, not a guaranteed payout, and participants continue to face changes in Ethereum’s market price.
Sygnum targets 8–10% annual returns with new Ethereum fund
Sygnum developed the fund for qualified and professional investors who want to increase their Ethereum holdings without selling their existing exposure.
The bank estimates that conventional ETH staking currently generates annual rewards of approximately 2% to 3%. Its new product targets a higher return by combining staking income with trading strategies managed by specialist investment firms.
Unlike investment products that calculate performance in dollars, the ETH Alpha Fund records its profits and losses in Ethereum. Investors therefore measure performance by the amount of ETH held, even when the cryptocurrency’s dollar price changes.
Markus Hämmerli, Sygnum’s head of asset management and the fund’s lead, said institutional investors increasingly assess their Ethereum holdings in terms of the cryptocurrency itself.
“Institutions that hold ETH for the long term increasingly think in ETH, not dollars,” Hämmerli said.
He explained that the fund combines staking with income-generating strategies intended to increase the amount of Ethereum investors hold.
The fund is managed through Sygnum Asset Management, part of Sygnum Bank AG’s Investment Solutions department, and is available to eligible investors in approved markets, including Switzerland.
How Sygnum’s Ethereum fund plans to generate returns
The investment strategy begins with native Ethereum staking, through which ETH holders help secure the blockchain and receive protocol rewards.
Sygnum then adds options premiums, arbitrage between trading venues and income from funding rates and other derivatives positions.
Options strategies can generate premiums when traders sell contracts, while arbitrage strategies seek to capture pricing differences between markets. Derivatives funding strategies seek income from differences in financing costs or payments between trading positions.
The bank describes these trading approaches as market-neutral because their intended returns do not depend primarily on Ethereum prices rising.
However, the fund itself remains exposed to ETH price movements because its underlying investment is denominated in Ethereum.
A decline in ETH’s dollar value could therefore reduce an investor’s holdings when measured in dollars, even if the fund earns additional ETH.
Sygnum’s fund information sets the minimum investment at $100,000 or its equivalent in ETH. Subscriptions take place monthly with two business days’ notice, while redemptions require 15 calendar days’ notice.
The product carries risks associated with derivatives, staking, liquidity, counterparties and trading systems. Its use of leverage in some strategies may increase losses during volatile markets.
Sygnum keeps Ethereum collateral away from trading exchanges
The fund uses Sygnum Protect, the bank’s off-exchange custody service, to support its trading activities.
Under the arrangement, collateral remains with Sygnum while investment managers execute strategies through supported trading venues.
This structure is intended to reduce the amount of client collateral held directly by cryptocurrency exchanges, although it does not eliminate trading or counterparty risks.
In March 2025, the bank expanded its custody service by adding derivatives exchange Deribit to Sygnum Protect.
The service uses custody infrastructure that allows customers to trade against assets held at the bank.
More recently, Sygnum was identified as a custody partner when Bitget introduced off-exchange trading arrangements for institutional clients.
According to Sygnum’s product documentation, its ETH Alpha Fund supports monthly redemptions rather than immediate withdrawals, with an investor-level redemption gate of up to 10%.
Ethereum fund follows Sygnum’s Bitcoin investment product
The Ethereum launch follows Sygnum’s introduction of a similar fund for Bitcoin investors in October 2025.
As crypto.news previously reported, the bank partnered with Starboard Digital to establish the BTC Alpha Fund, which targets annual returns of 8% to 10% in Bitcoin after fees.
The Bitcoin product combines exposure to BTC prices with arbitrage strategies intended to generate additional returns in the cryptocurrency.
Its launch gave institutional clients another investment option alongside the bank’s existing custody, trading and staking services.
Sygnum has continued supplying cryptocurrency infrastructure to traditional financial institutions. In July 2026, Swiss bank BancaStato introduced crypto trading services through an integration involving Sygnum and banking software provider Avaloq.
The arrangement allows BancaStato customers to buy, hold and sell Bitcoin, Ethereum, Litecoin and Solana through the bank’s existing digital platforms.
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