BFM Crypto, le Club – Interviews with Cyril Sabbagh

Cyril Sabbagh, Managing Director at Melanion Capital talks more about Melanion’s Bitcoin thematic UCITS ETF during an interview on BFM Crypto with Guillaume SOMMERER, co-editor in chief at BFM Business, and Valentin Demé, journalist at Cryptoast.

BFM Crypto, leClub: Why Bitcoin is not benefiting from the rise of traditional markets ? 01-12

During this interview, Cyril Sabbagh, designer of our Bitcoin thematic ETF, discussed the following topics:

1-    Bitcoin in comparison with traditional markets and the diversifying utility of Bitcoin

2-    Presented two components of our ETF: Northern Data and Block Inc.

3-    FTX regulation and its collapse

4-    Risk comparison between FTX and our Bitcoin thematic ETF

Cyril explained how we had a very negative correlation over the past month between Bitcoin and traditional equity markets: When Bitcoin went down the equity markets went up. On the other hand, at the start of the Russia-Ukraine crisis, it was the opposite: the cryptos had risen and the equity markets had fallen. So, this role of diversification appears today less than what we had seen before, but in any case, diversification is present.

Talking about Northern Data and Block Inc, Cyril described the role of both companies: The first offers very powerful computer machines with high computing capacity, used by Bitcoin miners to validate transactions on the blockchain and it offers hosting services in data centers it owns as well. The second is known by its former name Square, specialized in payment solutions allowing small and medium businesses to have payment terminals on tablets in any case to simplify the entire payment process for these businesses. They have projects to bring Bitcoin into everyday life.

At the end, Cyril shed the light on the high regulatory requirements in this ETF meaning that there is no same type of risk as FTX at all. The UCITS framework of this ETF is the strongest and most protective framework today for a fund in Europe, only investing in regulated products, having a diversification ratio, perfect transparency and risk management with very precise rules, and the funds must be deposited with an independent depositary bank where the management company cannot at all use client funds.

Attention: Past performance does not guarantee future performance.

BFM Crypto, le Club: Is BTC less volatile than the stock market in the last days? – 25/10

During this interview, Cyril Sabbagh, designer of our Bitcoin thematic ETF, discussed the following topics:

1- How is Bitcoin less volatile than the market?

2- Is this translated by an evolution of Bitcoin?

3- Will the new accounting rule encourage companies to buy Bitcoin?

4- Has your ETF evolved with investors during its first year?

5- Does your ETF continue to track the price of Bitcoin?

6- Two companies from this ETF: Microstrategy and Canal.

He talked about the Bitcoin volatility in comparison to the S&P500 and the Nasdaq, where Bitcoin has experienced a lower volatility over the past 30 days. From a purely analytical perspective, he added that Bitcoin volatility is currently at historically low levels.

In addition to that, he mentioned that when we reach a low point we will not stay there. What is also very interesting is that we are seeing the result of decorrelation with traditional markets. And from an allocation point of view, it is often said that Bitcoin is a diversification asset.

According to Cyril, the new accounting rule is going in the right direction: considering bitcoin as a traditional asset. There is indeed a strong tax incentive: it is very good for the ecosystem, for the increasingly strong adoption of crypto in general and bitcoin in particular.

He shed the light on the evolution of mentalities since the launch of this ETF a year ago where there are 2 types of actors: wealth management professionals and insurers since a wealth management adviser invests his client’s money in life insurance.

There is a very strong correlation between our ETF and Bitcoin because the last 6 months show a completely identical performance. As it was mentioned before, during the 2 summer months, our ETF outperformed Bitcoin by 40% and then underperformed by 10%. So there are back and forth and it’s not a straight line, but we have an allocation on the crypto ecosystem with a very strong correlation with Bitcoin.

Talking about Microstrategy and Canal, Cyril gave a brief description of the two companies. The first has a business model specialized in business intelligence and holds the most bitcoins in the world: 130,000 bitcoins worth almost 2.5 billion dollars, outperforming most companies in this ecosystem. The second is a blockchain service company providing supercomputer solutions and the inventor of ASIC mining machines.

Cyril also mentioned that Melanion Capital is interested in NFT markets.

Attention: Past performance does not guarantee future performance.‍

BFM Crypto, le Club: Bear Market and layoffs, how is the cryptocurrency industry doing? – 08/30

During this interview, Cyril Sabbagh, designer of our Bitcoin thematic ETF, discussed the following questions:

◽️ Why has our ETF outperformed Bitcoin by nearly 40% since early July?

◽️ What have been the factors that have allowed mining companies to catch up in the last 2 months?

◽️ How did Marathon Digital stand out from other players with a 113% increase in just 2 months?

Attention: Past performance does not guarantee future performance.

BFM Crypto, le Club: What is a crypto ETF  ? – 06/07

During this interview, Cyril Sabbagh, designer of our Bitcoin thematic ETF, discussed the following questions:

1-    What is a crypto ETF?

2-    How was the performance of your ETF during the past months?

3-    What are the holdings within your ETF that present a particular attractive potential?

4-    Is there a competitive advantage of the ETF in terms of platform fees or is it the other way around?

He discussed how the only possible way to invest in the Bitcoin thematic is through a classic traditional investment wrapper. Cryptocurrencies cannot be directly invested in these wrappers therefore our Bitcoin ETF doesn’t contain any Crypto or Bitcoin, but it invests in crypto ecosystem equities selected and weighted based on their historical sensibility to Bitcoin.

Cyril also discussed how our Bitcoin thematic ETF outperformed Bitcoin on an average of 5 to 10% since the last interview.

He shed the light on both Stronghold and Bakkt as important holdings in our Bitcoin ETF: The first as an American crypto mining company focusing on minimizing carbon emissions and shifting to alternative energy creating a competitive advantage in Bitcoin mining. And the second as an American company offering crypto services on both traditional and institutional levels.

Regarding the platform fees, Cyril mentioned the low management fees (0.75%/year) compared to other crypto platforms giving our crypto ETF a competitive advantage.

Attention: Past performance does not guarantee future performance.

BFM Crypto, le Club: The world’s first Bitcoin thematic UCITS ETF – 08/06

During this interview, Cyril Sabbagh, designer of our Bitcoin thematic ETF, discussed the following topics:

1-    The world’s first Bitcoin thematic UCITS ETF

2-    The components of this ETF

3-    Volatility of this Bitcoin ETF

4-    Placing our ETF in a PER

5-    Reason of the last visit to Italy

At the beginning, he mentioned that our Bitcoin ETF invests inequities from the crypto ecosystem, and that there is no crypto or Bitcoin, in other words, there is no risk of hacks or theft, or counterparty risk. He added that it consists of 30 companies that are the most sensitive to Bitcoin and the portfolio is rebalanced every 3 months.

Afterwards, he chose 2 companies in our Bitcoin ETF to talk about: Big Digital and Overstock. The first is a Canadian crypto and Blockchain services company that focuses on risk and compliance. The second is an American company that offered to customers the possibility of paying or being reimbursed in Bitcoin.

Cyril explained that in our ETF, volatility is present because we have stocks that are in the crypto ecosystem, which is a volatile ecosystem.

In addition to that, he talked about the fact that this Bitcoin ETF is the only possibility of exposure to the Bitcoin thematic in a ‘Plan d’Epargne Retraite’ PER.

At the end, Cyril revealed the reason behind the last visit to Italy: We organized a Bell Ceremony at Borsa Italiana where we listed our Bitcoin ETF to be the perfect alternative to a direct Bitcoin Tracker for Italian investors.

Attention: Past performance does not guarantee future performance.

BFM Crypto, le Club: Investing in the crypto ecosystem without investing in cryptocurrencies – 11/05

During this interview, Cyril Sabbagh, designer of our Bitcoin thematic ETF, discussed the following questions:

1-    How is the performance of your Bitcoin ETF now?

2-    Is it a crypto ETF without crypto inside?

3-    Why did you choose not to invest in crypto?

4-    How important is the correlation between Nasdaq and crypto ETF?

5-    Is the crypto ecosystem rich enough to keep your Bitcoin ETF diversified?

6-    Can you illustrate one or two companies from this crypto ETF?

As a start, Cyril mentioned that the whole crypto ecosystem is suffering now which will affect our crypto thematic ETF as well.  

After that, he discussed the composition of the world’s first Bitcoin thematic UCITS ETF, as there’s no active cryptocurrencies or Bitcoin but there are companies that belong to the crypto ecosystem for example companies that offer crypto services and crypto financial solutions.

Cyril also explained the reason behind this choice: To have the famous UCITS stamp, it is not allowed, in this ultra-secure regulatory framework, to be able to integrate cryptos yet.

He highlighted the correlation between Nasdaq and the crypto ETF by giving the example of what happened at the start of the Russia-Ukraine crisis where the correlation between Bitcoin and Nasdaq was very low (around 20%),therefore, we should know that the concept of correlation is linked to the period meaning that there is a very strong correlation now indeed.

In addition to that, Cyril discussed the increasing importance of the crypto ecosystem. When we started this project there were a few crypto miners who were listed. Today, not a week goes by without an IPO in this crypto ecosystem. The important point about this Bitcoin ETF is that we are interested in the sensitivity of each company to Bitcoin:  30 companies are chosen based on the ones with the highest sensitivity and the largest beta in relation to bitcoin, where they will be weighted accordingly.

At the end, he chose 2 companies to talk about: Argo Blockchain and Silvergate Capital. The first is a crypto mining company listed in the UK and focuses mainly on green mining through solar and hydraulic systems. The second is a US crypto bank that offers custodial services.

Attention: Past performance does not guarantee future performance.


This information is educational, and is not an offer to sell or a solicitation of an offer to buy any security. This information is not a recommendation to buy, hold, or sell an investment or financial product, or take any action and must not serve as the basis for any investment decision. All investments involve risk, including the possible loss of capital. Past performance does not guarantee future results or returns. Before making decisions with legal, tax, or accounting effects, you should consult appropriate professionals.

The information relayed in this article must be considered and analyzed in light of all the risks identified in the fund’s pre-contractual documentation, which you can find via the following link.

Stay informed

Sign up to our newsletter and receive regular updates about Bitcoin and how you can invest in it. 

Need more guidance and support? We’re here to help.
Book a one-on-one call with our experts

Continue reading