Cross Light Capital, a Malaysian fund management company, has partnered with Affin Bank to launch Malaysia's first digital asset fund, named the Performa Digital Asset Fund. This pioneering fund aims to provide premier banking clientele with exposure to digital assets through exchange-traded funds (ETFs) and exchange-traded products (ETPs). Here's a detailed overview of this new venture:

Key Features of the Performa Digital Asset Fund

1. Target Audience:
- Exclusive Access: The fund is available through the invitation-only Affin Invikta suite, targeting sophisticated investors with a significant risk appetite.
- Premier Banking Clients: The fund is geared towards clients of Affin Bank who are looking to diversify their investment portfolios.

2. Investment Strategy:
- Asset Allocation: The fund employs a balanced distribution strategy:
- Bitcoin ETPs: One-third of the investments.
- Ether ETPs: Another third of the investments.
- Blockchain-related Equities: The remaining portion, including investments in companies like Coinbase Global Inc. and Ubisoft Entertainment SA.
- Actively Managed: Jason Lee, CEO and Chief Investment Officer of Cross Light Capital, emphasized the fund’s active management approach to effectively navigate the digital asset space.

3. Investment Requirements and Fees:
- Minimum Investment: US$1,000.
- Upfront Sales Charge: Up to 5%.
- Annual Management Fee: 2%.
- Withdrawal Charges: None.
- Trustee and Auditor: MTrustee Bhd and Crowe Malaysia PLT respectively.
- Prime Broker and Custodian: Interactive Brokers LLP.

4. Investment Outlook:
- Risk and Returns: The fund is designed for investors with a high-risk tolerance, anticipating potential drawdowns of 30% to 60% within a year.
- Long-term Perspective: Investors are advised to adopt a five to ten-year investment horizon.

Market and Regulatory Context

1. Strategic Importance:
- Diversification: Calvin Goon Cheng Yu, Head of Wealth Management at Affin Bank, highlighted the importance of diversifying portfolios and tapping into the digital economy through this fund.
- Digital Economy Potential: The initiative reflects a growing recognition of the digital economy’s potential and the importance of offering sophisticated investment vehicles beyond traditional asset classes.

2. Recent Developments:
- Regulatory Scrutiny: Malaysia's crypto sector has seen regulatory actions, including the recent dismantling of a forex investment fraud and cryptocurrency syndicate operating in the Klang Valley.
- Market Conditions: The cryptocurrency industry experienced a significant downturn in losses from hacks and scams in April, with the lowest combined losses since 2021, totaling approximately $25.7 million.Conclusion

The launch of the Performa Digital Asset Fund by Cross Light Capital and Affin Bank represents a significant step forward in Malaysia’s financial landscape. It provides premier banking clients with a unique opportunity to invest in digital assets through a well-structured and actively managed fund. By balancing investment in Bitcoin and Ether ETPs and blockchain-related equities, the fund aims to offer substantial diversification and long-term growth potential despite the inherent risks associated with digital assets. This initiative underscores the evolving regulatory and market dynamics in Malaysia, highlighting the importance of balanced regulation to foster innovation while ensuring financial stability.