London hedge fund Prime Factor Capital Ltd., managed by former employees of BlackRock Inc. and RWE AG, became the first cryptocurrency-oriented investment company approved by British regulators, Bloomberg writes.
The company reported that it will operate as an alternative investment fund in accordance with the rules in force in the European Union. This will allow Prime Factor to manage more than 100 million euros in assets and attract institutional investors.
"Most investment instruments in the cryptocurrency industry are beyond the competence of regulators. This is a big problem for a market with such a bad reputation," said Prime Factor's Operations Director Edam Grimsley.
Grimsley, a former investor in the world's largest investment company in terms of assets under BlackRock, opened Prime Factor in 2017 with his former colleague Michael Vaughan and RWE AG trader Nick Niedermeowe.
Prime Factor, as a full-fledged manager of an alternative investment fund, should appoint an independent custodian to oversee, reconcile cash flows and hold assets, Grimsley explained. Such measures are necessary to ensure that investors are assured that the value of assets managed by the fund corresponds to its stated values and is verified.
Earlier it became known that the UK may prohibit cryptocurrency derivatives for retail investors.