Can banks issue structured products on crypto?

Not economically on their own balance sheet. Under the Basel Committee's prudential treatment of cryptoasset exposures, most direct crypto holdings fall into Group 2 and attract a 1250% risk weight — requiring roughly a dollar of capital for every dollar of exposure. Issuing through a standalone, bankruptcy-remote special purpose vehicle (SPV) keeps the exposure off the bank's balance sheet, so the product can be offered as a fully bankable ISIN security without the capital charge.

What is an actively managed certificate (AMC)?

An AMC is a structured product whose underlying is a discretionary strategy the manager runs on an ongoing basis, rather than a payoff fixed at launch. The manager adjusts the constituents — tokens, weights, exposures — while investors hold one security with one ISIN, one valuation, and one reporting line. New positions can be configured in days rather than the months a fund launch takes.

How large is the structured products market?

Worldwide structured-product sales reached an estimated USD 1.4 trillion in 2024, up more than 37% year on year across over half a million individual products. Three hubs anchor the market: Switzerland (roughly CHF 260 billion outstanding), the United States (a record USD 149 billion of structured-note issuance in 2024) and Asia-Pacific.

How can asset managers offer crypto strategies without launching a fund?

By packaging the strategy into an actively managed certificate issued off balance sheet through an SPV. The manager actively runs and rebalances the underlying crypto positions inside a single bankable security with an ISIN, launching in days rather than the months a fund requires, and without becoming an issuer.

Structured Products on Digital Assets

01Executive Summary

Digital assets have become an institutional asset class, and the investors allocating to them now ask for what they expect from every other asset class: defined risk, defined return, a familiar legal wrapper, and a single line in their reporting. Spot access through ETFs solved the first problem. It did not solve this one.

The instruments that answer it, structured products, form a mainstream global market of roughly USD 1.4 trillion in annual sales. On digital assets, that menu barely exists. This paper is for the two groups positioned to change that: banks and asset managers.

Each faces a different obstacle. Banks own the client relationships and the distribution, but Basel's prudential treatment of cryptoasset exposures makes manufacturing these products on their own balance sheets prohibitively expensive. Asset managers have the strategies, but lack a fast, bankable format for packaging them, and no ability to originate structured payoffs on their own.

One issuance model resolves both. A standalone, bankruptcy-remote special purpose vehicle (SPV) holds the exposure and can be used to issue structured products with digital asset underlyings as fully bankable securities with an ISIN. Nothing touches the bank's balance sheet. Nothing requires the manager to become an issuer. On that single rail, the full structured-product menu becomes available on digital assets: asymmetric products that reshape risk and return, from capital protection to yield enhancement, and tracker-type products that pass performance through, including actively managed certificates. Banks can access all of it. Asset managers can use the part built for active management. This paper sets out the demand, the gap, and how the model works in practice.

02The Demand Is Here. The Supply Is Not.

Digital assets have crossed the threshold from a speculative curiosity into an institutional asset class, and the first half of 2026 tested that status severely. After spot Bitcoin exchange-traded products peaked near USD 170 billion in late 2025, Bitcoin fell nearly 30% over the first half of 2026, touching lows near USD 58,000 in June, and US spot Bitcoin ETF assets dropped to roughly USD 73 billion, with June marking the heaviest month of redemptions since the products launched. Yet the structural signals held: cumulative net inflows since launch remain positive, Bitcoin holdings inside the ETFs stayed near their historical peaks in coin terms, and corporate treasuries kept buying through the dip. Tactical money left. Long-term allocators stayed.¹

The direction of travel is unambiguous. In early-2026 surveys, roughly three-quarters of institutional investors said they planned to increase digital-asset allocations during the year, and about two-thirds already access the asset class through regulated, exchange-traded vehicles rather than holding tokens directly. Tellingly, that same cohort has sharpened its focus on risk management, liquidity, and position sizing², precisely the disciplines a defined-risk, defined-return wrapper serves better than raw spot. The first-half-2026 drawdown only reinforces the point: investors who watched ETF assets fall by more than half from their peak have first-hand reason to want downside protection built into how they hold the asset.

Yet the clients driving this demand rarely want raw spot exposure. They want what they already get from every other asset class: defined risk, defined return, a familiar legal wrapper, and a single line in their custody and reporting systems. They want yield in flat markets, downside protection in volatile ones, and the ability to express a view without holding tokens directly.

Structured products answer that demand precisely. But the institutions best placed to manufacture them, banks, are structurally constrained from issuing crypto-linked products on their own balance sheets. And the asset managers whose strategies could meet it lack a fast, bankable format to package them in. The result is a supply gap: strong, regulated demand meeting limited, structurally constrained supply. This paper sets out the opportunity that gap creates for banks and asset managers, and how GenTwo's off-balance-sheet issuance model closes it.

03A Mainstream, Global Market

Structured products are not a frontier experiment but a mainstream, global asset class. Worldwide sales reached an estimated USD 1.4 trillion in 2024, up more than 37% year on year across over half a million individual products, and more than double the level of 2020.³ Three regional hubs anchor that activity, and each is relevant to where crypto-linked structures go next.

Switzerland is the world's largest market for structured products, with roughly CHF 260 billion outstanding as of mid-2025; yield-enhancement structures alone make up about a third of that volume, and secondary-market turnover on the Swiss exchange has recently run well above the prior year.⁴ It is also GenTwo's home market and the base of its issuance infrastructure.

The United States is the fastest-growing of the major markets. Structured-note issuance reached a record USD 149 billion in 2024, up 46% in a single year, as advisers increasingly use defined-outcome notes as bond and equity replacements.⁵ The market is dominated today by large bank issuers and traditional underlyings, but its scale signals the depth of appetite for packaged, defined-risk exposure.

Asia-Pacific is the third pillar and the most yield-driven of the three: autocallable yield-enhancement structures account for roughly 55% of regional sales, and markets such as South Korea sustain multi-billion-dollar monthly issuance of equity-linked products.⁶ Tellingly, US equities are among the most common underlyings: a reminder of how readily the region's structured-product machinery absorbs new and cross-border exposures.

Across all three hubs the pattern is the same: deep, well-established demand for defined-outcome products, distributed through familiar bankable wrappers.

And digital assets are unusually good raw material for that machinery. Structured products turn volatility from a liability into an input. The same price swings that make spot crypto uncomfortable for conservative mandates are exactly what fund attractive yields, financing of protection, and engineered payoff profiles. A volatile underlying is not an obstacle to a structured product; it is the ingredient that makes the economics work.

Critically, these products travel on rails institutions already run. A structured product is issued as a security with an ISIN. It clears, settles, custodies, and reports like any other note or certificate. That means an institution can give clients crypto exposure without rebuilding its operating model around wallets, keys, and on-chain settlement, and without taking unhedged directional risk itself. That is precisely the infrastructure onto which digital-asset payoffs can be added, which is why the gap described next matters so much.

Track One

For Banks

04The Gap: Why Banks Cannot Manufacture This On Balance Sheet

Banks issue structured products on equities, rates, credit, and commodities every day. On digital assets, they largely do not, and the reason is not lack of appetite. The constraint is prudential, not commercial. Under the Basel Committee's standard for the prudential treatment of cryptoasset exposures, most direct crypto holdings, including Bitcoin and Ether, fall into "Group 2," the category that does not meet the conditions for favorable treatment. Group 2 exposures attract a risk weight of 1250%.⁷

In practice, a 1250% risk weight is punitive by design. Applied against the standard 8% minimum capital ratio, it requires a bank to hold capital roughly equal to the entire value of the exposure: effectively a dollar of capital for every dollar of crypto. On top of that, banks face an aggregate exposure limit. Group 2 holdings should generally stay within about 1% of Tier 1 capital, and breaching 2% pulls the entire Group 2 book into the harshest treatment.

For a bank, that math is prohibitive. Warehousing crypto to manufacture and hedge a structured product on balance sheet consumes scarce capital out of all proportion to the fee earned. So most banks simply do not, even as their own clients ask for the product.

05The Solution: Off-Balance-Sheet Issuance

Banks own the client relationships and the distribution. Their private-banking and wealth clients are asking for digital-asset access in a packaged, advised format. Today much of that demand is either declined or routed to third parties, taking fee income and relationship primacy with it. A workable issuance route lets a bank meet the demand, retain the economics, and stay within its risk appetite, because the exposure never has to sit on its balance sheet.

The gap is structural, so the answer is structural. Instead of holding crypto on the bank's own balance sheet, the exposure is securitized through a bankruptcy-remote special purpose vehicle (SPV). The SPV, not the bank, holds the underlying and issues the product as a fully bankable security with an ISIN. The capital-requirement problem dissolves, because the exposure was never on the institution's balance sheet to begin with.

Two properties make the model work in practice:

Off-balance-sheet by construction.Issuance through a bankruptcy-remote vehicle keeps digital-asset exposure off the bank's balance sheet, taking the Basel capital charge out of the equation while still delivering a regulated, distributable security.
Any asset, including digital.Virtually any underlying can be securitized, from spot crypto, tokens, and DeFi strategies to baskets, into a standard ISIN-bearing product that slots into existing custody and reporting.

For the bank, the result is a shelf it could not build on its own balance sheet: crypto-linked structured products it can offer under its own name, in formats its clients already know.

Sidebar

Asymmetric Products on Digital Assets: Four Use Cases

The same off-balance-sheet rail supports the full range of structured payoffs. Four examples illustrate how different client needs are met, from conservative entry to active income.

Capital Protected Note

The conservative entry point

A capital protected note offers participation in the upside of a digital asset while protecting all or most of the invested principal at maturity. It is the natural first step for cautious or first-time allocators: defined downside, meaningful upside, and a familiar note format.

Dual Currency Note

Yield and treasury management

A dual currency note pays an enhanced coupon in exchange for the possibility of redemption in a second currency or asset at a pre-agreed rate. For treasuries and yield-seeking allocators, it turns a willingness to convert between fiat and a digital asset at a known level into income: a practical bridge between cash management and crypto exposure.

Barrier Reverse Convertible

Income in volatile markets

A barrier reverse convertible pays a fixed coupon and returns full principal provided the underlying never breaches a defined barrier; if it does, the investor takes delivery of the asset. It monetizes volatility directly, which is why yield-enhancement structures of this kind make up roughly a third of the Swiss market, the world's largest.⁸ On a volatile underlying like crypto, the coupons such structures can generate are correspondingly attractive.

Discount Certificate

Packaged call overwriting

A discount certificate lets an investor buy exposure to a digital asset at a discount to its current price, in exchange for capping the upside at a fixed level. Economically it packages a covered-call, or call-overwriting, strategy into a single security: the investor gives up the upside above the cap and is paid for doing so through the discount, which also cushions moderate declines. It suits a neutral-to-moderately-bullish view, and on a high-volatility underlying like crypto the discount earned for capping the upside can be substantial.

One product type is missing from this list. The actively managed certificate completes the menu, and it deserves its own treatment.

Track Two

For Asset Managers

06The Manager's Problem: Speed, Packaging, Active Management

For asset managers, the structured wrapper is a distribution and management vehicle in one. It converts a strategy, whether directional, yield-harvesting, or protective, into a bankable security that clients can buy through their existing accounts. It also allows the manager to actively run and rebalance the underlying crypto positions inside that security. Used this way, a structured product becomes a risk-allocation tool: a manager can choose an underlying for the exposure or correlation it adds to a portfolio, then engineer the coupon or payoff needed around it, rather than accepting whatever risk and return the spot asset happens to offer.

The obstacle is not appetite but format. Crypto markets move too fast for a static, buy-and-hold wrapper to be enough. Asset managers need to rebalance, rotate, take profit, and manage risk as conditions change, and to do it inside a single, investable instrument. The traditional route to a bankable format, setting up a fund, takes months and carries a cost base to match. The opportunity in digital assets does not wait for that.

07The AMC: A Structured Product You Can Manage

Actively managed certificates (AMCs) provide exactly that. An AMC is a structured product whose underlying is a discretionary strategy the manager runs on an ongoing basis, rather than a payoff fixed at launch. The manager defines and adjusts the constituents, from tokens to weights to exposures, while investors hold one security with one ISIN, one valuation, and one reporting line. New positions can be configured in days rather than months, letting managers launch and iterate at the pace the asset class demands. The wrapper handles the operational complexity; the manager focuses on the strategy.

Like the other structured products already mentioned, demand for AMCs has been growing at a rapid pace. At GenTwo's Global AMC Summit 2026, a week of programming that brought together legal experts, platforms, banks, and distributors from across the AMC ecosystem, SRP, the structured products industry's leading data and content provider, presented its research on the state of the AMC market.⁹ The picture: estimates of the global market running from the hundreds of billions to as high as USD 1.6 trillion, a spread that reflects definitional fragmentation more than any doubt about growth, which is visible in new players, new strategies, and a wave of fintech entrants over the past five years. Two findings matter most for managers. The fastest growth is concentrated in strategies where the AMC provides distribution efficiency and structural flexibility. And for smaller or newer managers, the AMC increasingly functions as a proof-of-concept vehicle: a way to build a live track record with real capital at a fraction of the time and cost of a fund launch. Digital assets sit squarely at that intersection: a fast-moving asset class where strategies need testing, track records are still being built, and the manager who can package and distribute first has the advantage.

Sidebar

The AMC in practice: an active strategy in one security

A typical example: a manager runs a defensive digital-asset strategy built around a core allocation to Bitcoin and Ether. The positions earn staking yield where the protocol allows it. When markets turn, the manager rotates into stablecoins or trims exposure; when conditions improve, the manager re-risks. Constituents, weights, and trading venues change as the strategy demands. None of this touches the investor, who holds one certificate with one ISIN that sits in a portfolio like any other security. And the same wrapper carries whatever the strategy happens to be: a rules-based index of the largest crypto assets, an AI-driven quant model, a covered-call income strategy on Bitcoin, a thematic blockchain basket. The strategy is the product. The AMC is what makes it bankable.

Conclusion

One Rail, Two Problems

08One Rail, Two Problems

The bank's problem is capital. The manager's problem is speed and format. Different diseases, same cure: issuance through a standalone, bankruptcy-remote vehicle that holds the exposure so that no one else has to.

The bank gets the full structured-product menu on digital assets, without the Basel charge that makes manufacturing it in-house impossible. The manager gets a bespoke, bankable, actively managed product without becoming an issuer. And the end investor gets what they were asking for all along: crypto exposure with defined risk, defined return, and one clean line in the portfolio.

09Why GenTwo

The opportunity in crypto-linked structured products is real and growing; the obstacle is capital and format, not appetite. GenTwo removes both. Off-balance-sheet issuance, the ability to securitize any digital or traditional asset into a bankable ISIN, and the flexibility to issue through a bespoke issuance setup or via GenTwo's existing infrastructure, together let banks meet client demand without a capital penalty and let asset managers actively run crypto strategies inside a regulated security.

The model is proven in market. Collaborations such as the joint offering with Sygnum Bank for institutional crypto strategies, and a capital-protected Bitcoin accumulator launched with EDG UK, show the digital-asset model working today.¹⁰

Since 2018, GenTwo has helped more than 300 clients across 26 countries create over 1,600 products, and assets under service have surpassed USD 7 billion.¹¹ The platform, the experience, and the operational depth are in place to take a product from idea to issuance quickly and cost-efficiently.

For banks, the conversation starts with a bespoke issuance setup. For asset managers, it starts with your strategy and the AMC to carry it. Contact the GenTwo team.

Notes & Sources

US spot Bitcoin ETF assets peaked near USD 170bn in October 2025. June 2026 brought record monthly net outflows of approximately USD 4.1bn (SoSoValue data), with assets at roughly USD 73bn at month end and Bitcoin touching a year-to-date low near USD 58,000; Bitcoin holdings in ETF vehicles remained close to historical peaks in coin terms, cumulative net inflows since launch remain positive, and corporate treasury buyers continued purchasing through the June dip (cryptobriefing.com; kucoin.com; valuethemarkets.com). ↩
Coinbase / EY-Parthenon 2026 Institutional Investor Digital Assets Survey: ~73% plan to increase digital-asset allocations in 2026; ~66% access crypto via spot ETPs and 81% prefer a registered vehicle; 49% have strengthened risk-management and position-sizing discipline (coinbase.com; cointelegraph.com). ↩
SRP Global Market Overview 2024: worldwide structured-products sales of approximately USD 1.4 trillion in 2024, up 37.3% year on year across more than 500,000 products; the market has more than doubled since 2020 (structuredretailproducts.com). ↩
Swiss National Bank data, via SSPA / SIX: approximately CHF 260bn of structured products outstanding in Switzerland as of 31 August 2025; yield-enhancement structures about 35% of volume; Switzerland is the world’s largest structured-products market (sspa.ch; six-group.com). ↩
SRP US Market Review 2024: record USD 149.4bn of structured-note issuance in 2024, up 46% year on year (USD 139.9bn SEC-registered plus USD 9.5bn unregistered) (structuredretailproducts.com). ↩
SRP Asia-Pacific data, 2024–2025: autocallable yield-enhancement products about 55% of APAC sales; South Korea sustains monthly structured-product sales of roughly KRW 5tn (about USD 3.6bn) (structuredretailproducts.com). ↩
Basel Committee on Banking Supervision, prudential standard for cryptoasset exposures (SCO60). Group 2 cryptoassets carry a 1250% risk weight; analysis: PwC Switzerland; Ashurst. ↩
Yield-enhancement structures account for approximately 35% of the roughly CHF 260bn of structured products outstanding in Switzerland (SSPA; SIX; see note 4). ↩
Modern Perspectives on Actively Managed Certificates, GenTwo, 2026. ↩
GenTwo and Sygnum Bank joint offering for institutional crypto strategies (sygnum.com); EDG UK and GenTwo capital-protected Bitcoin accumulator (gentwo.com). ↩
GenTwo press materials and reporting: USD 7bn assets under service; 300+ clients across 26 countries; 1,600+ products since 2018 (startupticker.ch; einpresswire.com). ↩

Disclaimer

This document is for informational purposes only and is intended for professional and institutional audiences. It does not constitute investment, legal, tax, or financial advice, nor an offer or solicitation to buy or sell any product. Structured products involve risk, including possible loss of principal. Figures cited are drawn from public sources as referenced and may change.

Structured Products on Digital Assets.