Sygnum Launches ETH Alpha Fund Targeting 10% Yield for Institutional Stakers

Sygnum has launched the ETH Alpha Fund SP, a market-neutral investment vehicle designed to provide professional investors with yields of 8-10 percent denominated in Ethereum. By combining native staking with sophisticated derivative strategies, the fund allows institutional holders to increase their digital asset positions without exiting the ecosystem or incurring dollar-based conversion risks.

What was announced

The Sygnum ETH Alpha Fund SP is a regulated investment product that opened to investors on 2 November. It is specifically designed for corporate treasuries, exchange-traded funds (ETFs), and institutional holders who intend to maintain long-term exposure to Ethereum while generating a yield that exceeds standard protocol rewards. While traditional staking currently offers institutional holders a benchmark return of approximately 2-3 percent annually, this fund targets a net return of 8-10 percent in ETH.

The fund’s strategy is market-neutral, meaning investors remain fully exposed to the price fluctuations of ETH while the underlying yield-generating activities do not rely on the asset’s price direction. The core holdings are staked natively through Sygnum to earn protocol rewards. To achieve the additional "alpha" return, the fund employs three distinct strategies: harvesting premiums from options, capturing arbitrage opportunities between different trading venues, and utilizing carry and funding rates within derivatives markets. These strategies are managed by underlying specialists who have previously operated similar models in fiat-denominated markets.

All profits and losses within the fund are realized and reported in ETH. This "in-kind" approach ensures that the total amount of digital assets held by the investor grows over time, rather than being converted into a dollar-based yield. The fund is managed by Sygnum Asset Management, a subdivision of Sygnum Bank AG’s Investment Solutions department, and utilizes Sygnum Protect for off-exchange safekeeping.

"Institutions that hold ETH for the long term increasingly think in ETH, not dollars, and judge their year by whether they end it holding more. We built the fund around that measure, adding in-kind income strategies to staking within the safeguards of a regulated structure."

Markus Hämmerli, Head of Asset Management and ETH Alpha Fund lead at Sygnum.

The companies involved

Sygnum is a global digital asset banking group with a significant presence in the Swiss and Singaporean markets. Operating as a regulated entity, the group provides a bridge between traditional finance and the digital asset economy through services including banking, custody, and asset management. The firm has established itself as a specialist in institutional-grade infrastructure, focusing on the "tokenization" of the economy and the management of digital wealth. Markus Hämmerli, who leads the new fund, also serves as the Head of Portfolio Management at Sygnum Bank.

The launch of the ETH Alpha Fund marks the second such product in Sygnum’s "alpha" series. It follows the introduction of the Starboard Sygnum BTC Alpha Fund in October 2025. This product line reflects a partnership approach to asset management, where Sygnum’s regulated banking framework is combined with specialized trading strategies. The involvement of Starboard IT, an Australian-based technology firm, highlights the cross-border and technical nature of the infrastructure required to manage these complex digital asset strategies within a regulated environment.

What FF News has reported before

FF News has closely followed Sygnum’s efforts to integrate institutional-grade security with active digital asset trading. In September 2026, we reported that Sygnum and Bitget Launch Bank-Grade Off-Exchange Custody for Institutional Traders. This partnership was a significant step in addressing the counterparty risks associated with centralized exchanges, allowing institutional traders to keep their assets within Sygnum’s regulated custody while maintaining the ability to trade on external venues. This same infrastructure, specifically the Sygnum Protect safekeeping solution, is a core component of the risk management framework for the newly launched ETH Alpha Fund.

What this means

This announcement signals a maturing of the digital asset market, where "yield" is no longer just a byproduct of price appreciation or simple staking. By offering an 8-10 percent return denominated in ETH, Sygnum is challenging the traditional fund management model that views crypto solely through the lens of fiat conversion. This move puts pressure on traditional asset managers who offer crypto exposure but lack the technical infrastructure to run market-neutral derivative strategies in-kind. The industry is moving toward a "treasury mindset" where the goal is to accumulate a larger share of a network's total supply, rather than just chasing dollar-denominated volatility. However, the complexity of these derivative-based strategies raises questions about how consistently such high alpha can be maintained as more institutional players enter the arbitrage and funding rate markets.