PETALING JAYA (Aug 1): Halogen Capital garnered RM100 million in asset under management (AUM) since a year ago and is aiming for RM1 billion in the next two years, said its founder and chief executive officer Liew Ooi Hann.

“Looking ahead, our goal is to build on this momentum and be the global leader for shariah-compliant digital assets,” he said.

He said that the firm onboarded more than 20 distribution partners, including notable ones such as AHAM Asset Management Bhd (AHAM Capital), Kenanga Investors Bhd, UOB Kay Hian and Phillip Mutual Bhd.

The goal of hitting RM1 billion of AUM might seem ambitious, but it is a rather conservative amount as compared to the total AUM of the private asset management industry of about RM1 trillion and the total digital asset market capitalisation of RM11.5 trillion.

Its chief business officer Lucas Ooi said institutional investors, including fund managers, are starting to invest in digital assets through Halogen’s funds.

“Our distributing partners are investing in our funds. They have clients of their own who are interested in digital assets. There are also a few who are starting to allocate some of the funds in their [investment] portfolios to cryptos.

“Some [fund managers] put 1% of their portfolio into digital assets, while others that run different [investment] strategies might have 5% to 10% [in our digital asset funds],” he said.

Halogen, the first licensed digital asset fund manager in Malaysia, officially launched its four shariah-compliant cryptocurrency funds at W Hotel, KL, on July 31.

The four funds are the Halogen Shariah Bitcoin Fund, Halogen Shariah Ethereum Fund, Halogen Shariah Crypto Titans Fund and Halogen Shariah Ringgit Income Fund.

The firm also provides investors with six investment strategies through private mandate, namely the Active Multicoin Portfolios, Risk Hedged Crypto Portfolio, Crypto Income Portfolio, Crypto-Enhanced Diversified Portfolio, Smart Crypto Momentum Portfolio and Tactical Reallocation Portfolio.

Halogen also aims to hit its RM1 billion target by rolling out structured products and prime brokerage services moving forward, said Liew.

Put it simply, prime brokerage allows investors to pledge their assets as collateral for loans. The loans can then be used for various purposes, including investing in traditional securities or digital assets.

“If you look at the majority of other asset classes today, like real estate, bonds or equities, prime brokerage is quite common. Traditional fund managers work with securities firms or banks to offer such solution. We want to follow such a path and bring digital assets further into the mainstream,” he said.  

Halogen’s executive director and fund manager Fuad Alhabshi added that the firm is also looking for overseas expansion as it believes shariah-compliant digital asset funds are not common in many other countries, and it can complement the portfolios of overseas investors, particularly the Muslims.

Halogen’s investors include 500 Global, the Digital Currency Group (DCG), venture capital firm The Hive Southeast Asia and Penjana Kapital.

Penjana Kapital was recently acquired by sovereign wealth fund Khazanah Nasional Bhd with the aim of strengthening Malaysia’s venture capital ecosystem and improving public institutions.

Meanwhile, DCG is a US-based venture capital firm that focuses on the cryptocurrency market and invests in companies including cryptocurrency exchange Coinbase and cryptocurrency trading platform Luno.

As of July, the firm raised US$1.25 million through its seed funding rounds.

Asked about the firm’s valuation and whether it has plans to raise more funds from investors, Liew did not reveal the firm’s valuation and said that further fundraising exercises would depend on its growth moving forward.

“We are growing fast. And we hope to focus on our business for now. We are well funded and are speaking to many investors for future rounds [of fundraising].

“For us, we are looking for investors who can add value beyond just money. For instance, someone who really understands the capital market or perhaps a global institutional investor in the crypto space. We are speaking to strategic investors like this,” he said.