Exposure to cryptocurrency in New Zealand

Get exposure to Bitcoin the simple, smart and trusted way - through the Bitcoin ETF PIE Fund.

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What is cryptocurrency?

Cryptocurrencies are an emerging asset class that allows you to buy, sell or invest digitally. Since the creation of Bitcoin in 2009, cryptocurrencies have become a globally recognised alternative investment. Cryptocurrencies don't have physical form; they are digital assets based on blockchain technology, and are held on distributed ledgers controlled by decentralised networks.

Cryptocurrencies handle payments and investments without the need for centralised trusted parties such as banks. Unlike cash, many cryptocurrencies are not subject to inflation resulting from credit creation by governments.

Cryptocurrency in New Zealand

Cryptocurrency is a legal investment in NZ. However, the Inland Revenue Department (IRD) treats digital assets like property and this can influence the way they are taxed and in particular whether they are subject to capital gains tax (CGT).

You can buy Bitcoin or other cryptocurrencies and hold as an investment, or if you have business you can accept cryptocurrency as payment. Cryptocurrencies are not recognised as legal tender in NZ, but accepting them as payment is considered a barter transaction and remains taxable.

Always seek professional tax advice.

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What is the Bitcoin ETF PIE Fund?

The Bitcoin ETF PIE Fund (the Fund) is a PIE fund based in NZ. It is a quick, easy and simple way to invest in Bitcoin through trusted NZ platforms, without you needing to go through complex steps in investing in Bitcoin directly.

Investing directly in Bitcoin versus the Bitcoin ETF PIE Fund

Below is a detailed comparison of investing in Bitcoin directly versus investing in the Bitcoin ETF PIE Fund.

Investing in bitcoinInvesting in the Bitcoin ETF PIE Fund
Simplicity
  • For many, direct bitcoin is through unfamiliar technology and platforms.
  • Unfamiliar terminology.
  • Unfamiliar storage options.
  • Familiar investment vehicle (NZ PIE fund).
  • Purchased via mainstream retail investment platforms like InvestNow, or via your financial adviser.
  • Financial advice on appropriate % and time frame to hold.
  • The Fund is available on multiple wealth advisory platforms.
Security
  • Investors in direct bitcoin are responsible for their own security (12 - 24 word passphrase) on a Digital or Hardware wallet (e.g. Trezor $120 - $270 x 2 x 2 is recommended).
  • Or store on an exchange. Please note storage on an exchange or in a digital wallet comes with a risk, (eg Cryptopia, Mt Gox).
  • Direct bitcoin has the risk of scams, error, and loss of assets, especially for the less tech savvy investor.
  • Storage of digital assets may be an issue for NZ Trusts and companies, and for estate planning.
  • Invests in ETFs that in turn invest in bitcoin.
  • The assets of the Fund being the ETF funds are held by a regulated NZ custodian, Adminis.
  • The underlying bitcoin assets in the ETFs are stored offline, in a regulated custodian in cold storage (eg Fidelity).
  • The Fund invests in a number of ETFs that use differing custody approaches.
Tax
  • Direct bitcoin investments are typically taxed on total return including realised capital gains at the investor's marginal tax rate which can be as high as 39%.
  • Individual investor is responsible for records, tax calculation and filing, resulting in administration hassles and potential costs.
  • Fund returns taxed under FDR regime, ie no tax on capital gains.
  • FDR tax on 5% “deemed” dividend. An investor with a 28% PIR pays a maximum of 1.4% per annum of tax (being 5% p.a. x 28% = 1.4% p.a.). Investors with lower PIR rates pay less tax.
  • The Bitcoin ETF PIE Fund manages tax calculation and payment for you.
Fees
  • Direct bitcoin transactions costs can be as high as 1.0-2.5% on purchases and sales.
  • Plus forex fees, bank fees, network fees, exchange fees, wallet fees, wallet exit fees, etc.
  • The Bitcoin ETF PIE Fund fees are 0.95% per annum (including the costs of underlying ETFs)
  • No performance fees.
  • Spread margin of 0.25% on buy and sell (note this fee is retained in the Fund to pay transaction costs).

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Why should you invest in the Bitcoin ETF PIE Fund?

Investing in Bitcoin through the Bitcoin ETF PIE Fund, a New Zealand based PIE fund, is:

  • Simple: you buy units in a PIE fund (not Bitcoin directly)
  • Smart: you invest in a NZ PIE fund structure which may provide tax benefits
  • Trusted: you invest in a regulated investment product – a managed investment scheme

The Bitcoin ETF PIE Fund is a registered managed investment fund in NZ that only invests in regulated overseas funds that hold their assets in cold storage secured by international grade security. Raise doesn't hold your assets - these are held by a regulated NZ custodian.

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