Capital Protected Note on BTC

Note: GenTwo is a platform provider for structured products. This information is intended for professional investors only.

What is this product?

A capital-protected certificate that gives professional investors exposure to Bitcoin with a built-in floor: at maturity investors are repaid at least a defined portion of their capital even if Bitcoin falls, while participating in part of its rise up to a ceiling. It is a cash-settled instrument for investors who want Bitcoin upside with a limit on how much of their capital is at risk.

How does it work?

At maturity a single observation of the BTC/USD rate determines the payout. If Bitcoin finishes at or below its starting level, investors receive the protected amount — a defined minimum share of the denomination — so losses are limited to the unprotected portion. If Bitcoin finishes higher, investors receive that protected base plus a set share of the gain above the starting level, with the upside counted only up to a defined ceiling, and the certificate settles in cash at maturity.

What is the underlying asset?

The underlying is the price of Bitcoin measured against the US dollar. Bitcoin is the first and largest cryptocurrency — a decentralized digital asset that runs on a public blockchain with no central issuer or administrator, and whose total supply is capped by its protocol. For this certificate the relevant price is not drawn from a single exchange but from a defined reference rate, the Deribit 8am UTC fix, which the calculation agent uses to set both the starting and final levels.

Bitcoin trades around the clock and is known for pronounced price volatility, which is the characteristic that structured products on it are built around. Accessing that exposure through a securitized certificate also spares investors the operational demands of holding Bitcoin directly, such as custody and the safekeeping of private keys.

Who is behind it?

The certificate is issued by SHA256 Issuer SPC, a Cayman Islands segregated portfolio company that issues the product through a dedicated segregated portfolio, with ISP Securities AG in Switzerland acting as paying agent. STS Digital Ltd, based in Bermuda, serves as both the hedge provider — supplying the economic exposure to Bitcoin that backs the certificate — and the storage provider responsible for safekeeping the underlying digital assets. GenTwo AG provides the securitization infrastructure.

What kind of instrument is this?

A Capital Protected Certificate is a structured product that combines a defined minimum repayment at maturity with participation in the performance of an underlying asset. Investors receive at least the protected amount regardless of how the underlying performs — protection may apply to all or part of the capital — while sharing in a portion of the underlying’s gains and holding a claim against the issuer rather than owning the asset directly.