KUALA LUMPUR (Jan 23): Digital investment platform StashAway will be offering Bitcoin and Ethereum exchange traded funds (ETFs) on its platform, enabling Malaysians to invest in the two largest cryptocurrencies through a regulated and trusted platform.

The ETFs are now available via StashAway’s flexible portfolio, where investors can build diversified portfolios with exposure to both crypto and traditional asset classes like equities, bonds, and gold. 

While the mainstream and institutional adoption of crypto has been growing, there are still many investors who are wary about the complexities of owning crypto, such as the risk of losing their funds due to a lost or compromised private key for a crypto wallet.

“Many of our clients expressed interest in the long-term potential of major cryptocurrencies like Bitcoin but have been hesitant because of security concerns or the complexities of navigating crypto exchanges. We are now offering them a familiar and safe way to diversify their portfolios by incorporating crypto through a platform they already know and trust,” said Wong Wai Ken, StashAway Malaysia’s country manager.

The crypto ETFs available on flexible portfolios, Fidelity Wise Origin Bitcoin Fund (FBTC) and Fidelity Ethereum Fund (FETH), have an expense ratio of 0.25% per annum.

This launch comes at a pivotal moment in the crypto market, marked by growing institutional adoption as the price of Bitcoin crossed the US$100,000 (RM444,700) milestone. With the newly inaugurated US administration signalling support for crypto-friendly regulations, investors have shown renewed interest in this new and growing asset class.

“So much de-risking has gone through this industry to bring us to this point, and I would say a major catalyst is [US President Donald] Trump. With him in office and vowing to be the first crypto president, much more policy will be put in place to legitimise Bitcoin,” Wong said.

It was also reported on Wednesday that the US Securities and Exchange Commission's (SEC) new leadership had created a task force to develop a regulatory framework for crypto assets, in the first major move by Trump's new administration to overhaul crypto policy.

The task force's focus will be to help the commission draw clear regulatory lines, provide realistic paths to registration, craft sensible disclosure frameworks, and deploy enforcement resources judiciously.

Trump has pledged to reverse an industry crackdown under former president Joe Biden's SEC, which sued multiple crypto companies, including Coinbase and Kraken, alleging they had flouted its rules.

Wong said multiple studies had suggested that a small allocation to Bitcoin in a diversified portfolio can enhance long-term returns without necessarily heightening volatility. He said over the long term, a 5% allocation to Bitcoin in a traditional 60/40 portfolio can uplift returns while improving the risk-to-reward ratio. 

The core premise is to allocate 60% of the portfolio towards long-term growth and 40% to fixed-income to moderate stock market volatility. The 5% allocation will be part of the former.

“Ultimately, it's not allocating too much because of the potential drawdowns, as the maximum drawdowns can wipe you out. But if you are investing in the right way, a little bit goes a long way, and crypto is also well positioned to be a long-term investment,” said Wong.

Consistent with StashAway’s fee structure, its flexible portfolio has a transparent, straightforward management fee of 0.2% to 0.8% per annum, with no lock-ins or minimum investment required. Flexible portfolios with only a single ETF have a flat management fee of 0.3% per annum.