Malaysia’s Affin Bank to Launch Nation’s First Islamic Digital Asset Fund by Q3 2024

Malaysia’s Affin Bank to Launch Nation’s First Islamic Digital Asset Fund by Q3 2024

Affin Bank, a leading financial institution in Malaysia, is set to introduce the country’s first-ever Islamic digital asset fund by the third quarter of 2024. This strategic initiative, which aims to diversify investment options in compliance with Shariah law, is a collaboration with an asset management firm, as reported by local news outlet StarBiz on Tuesday.

Launch of Shariah-Compliant Digital Asset Fund

The new fund will be an Islamic version of the existing Cross Light Capital Performa Digital Asset Fund. Shariah-compliant funds, also known as Islamic funds, operate under Islamic law, which prohibits the earning or payment of interest. Calvin Goon Cheng Yu, Affin Bank’s head of wealth management, emphasized that the current dip in the digital asset market, with Bitcoin’s price declining from $69,000 to $60,000, presents a valuable buying opportunity. He also highlighted that the Islamic product will provide an innovative avenue for diversifying investments beyond conventional assets such as stocks, bonds, and gold.

Affin Bank’s Press Conference Confirmation

An Affin Bank spokesperson confirmed Goon’s remarks, made during Monday’s press conference for the AFFIN INVIKTA x Malaysia’s Top 30 Women of Excellence Awards 2024.

Partnership with Cross Light Capital

Affin Bank has partnered with local investment firm Cross Light Capital to launch Malaysia’s pioneering digital asset fund. The Performa Digital Asset Fund, unveiled last month, targets affluent clients, offering access to digital assets through exchange-traded funds (ETFs) and products (ETPs). The fund’s portfolio includes Bitcoin, Ether, and investments in companies involved in blockchain technology, all through publicly traded investment vehicles. Exclusive to Affin Bank’s invitation-only Affin Invikta suite, the fund also holds stakes in renowned companies such as Coinbase and Ubisoft.

Aiming for US$30 Million in Assets Under Management

Despite initial market hesitancy, Goon revealed that Affin Bank aims to achieve a combined asset under management (AUM) of at least US$30 million for both the conventional and Islamic versions of the fund. To further attract younger investors, the bank plans to launch additional digital asset products in the future. Goon noted that the younger demographic is increasingly active in the market and that Affin Bank, not being a legacy institution, seeks to appeal to this dynamic segment by developing more enticing investment options to meet current market demands.

Conclusion

Affin Bank’s introduction of the Islamic digital asset fund marks a significant milestone in Malaysia’s financial landscape, providing investors with diversified, Shariah-compliant investment opportunities in the burgeoning digital asset market. The bank’s strategic partnership with Cross Light Capital and its focus on appealing to younger investors underscore its commitment to innovation and market responsiveness.

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