Maori-led fund seeks $100 million with Ethereum focus

A new Maori-led fintech initiative in New Zealand aims to attract over $100 million in investment within its first year by launching the Quay Cove Ethereum Growth Fund.

The Quay Cove Ethereum Growth Fund (QCEG), which cost more than $2 million and took two years to bring to market, is New Zealand's first cryptocurrency fund designed as a wholesale Portfolio Investment Entity (PIE) with a New Zealand-based custodian. It follows the establishment of the country's largest Ethereum staking operation by Everlasting.

The fund's founders state that its launch is a step towards New Zealand becoming recognised as a global digital asset hub. Ethereum, the second-largest cryptocurrency by market capitalisation, has experienced a 70% growth since the start of the year, reaching $490 billion. With its move to a more energy-efficient blockchain validation process in 2022, Ethereum now uses less than one per cent of the energy resources required to create Bitcoin.

Luke Ryan (Nga Puhi), the Chief Executive Officer of Everlasting Group and founder of Quay Cove, explained the development process of the Quay Cove fund. "The idea behind the fund began with Everlasting, a company focused on legacy planning and estate management. Through our work with high-net-worth clients, we noticed a growing interest in digital assets, particularly Ethereum - which led to the development of an accessible and regulated wholesale investment giving investors access to digital assets," he said.

Ryan also highlighted the role of tax regulation in the fund's development. "With the foundation of knowledge we had from working with the IRD on a previous ruling along with specialist consultants, we created an industry-first Ethereum fund with staking that is vertically integrated and entirely based within New Zealand," he added.

He further elaborated on New Zealand's emerging reputation as a digital asset safe haven. "What we are hearing from the global market is that NZ is being seen as the world's 'cold wallet' now - which in other words means digital assets held here are effectively insulated from the turmoil in the rest of the world by our regulatory stability and High Court rulings," Ryan said.

Ryan sees potential for New Zealand amid global political uncertainty, suggesting that the country's geographic isolation once considered a challenge in exporting products, is now an appealing factor in financial investment. "There is growing awareness among investors in Singapore and the greater Asia region that investing in New Zealand is not a bad idea," he explained.

"This poses an interesting narrative because we're not telling everyone that we want everything, but we're saying this is an option that you can consider for investment in digital assets and you could be a high net worth individual or you could be an asset manager that just wants to put a small allocation here," he continued.

Currently open to wholesale investors only, Ryan mentioned that the QCEG fund may eventually expand to a retail product as demand grows.