French Asset Management Firm Launches Europe’s First Bitcoin Mutual Fund
TOBAM, a France-based asset management company, has introduced a bitcoin mutual fund to offer an alternative investment for institutional investors seeking exposure to bitcoin. The fund, according to the company, is unregulated.
TOBAM’s bitcoin fund precedes the Chicago Mercantile Exchange’s plans to list bitcoin futures. In seeking to address challenges investors have faced in gaining exposure to bitcoin, the fund integrates the management of blockchain forks and takes measures to mitigate the risk of loss and theft, according to the TOBAM website.
Bitcoin, while volatile, offers investors diversification, according to TOBAM.
Access For Insitutional Investors
Bitcoin, which is not regulated by national financial regulatory bodies like the Securities and Exchange Commission in the U.S. and the Financial Conduct Authority in the U.K., cannot be held by most exchange-traded funds or by traditional mutual funds, according to the Financial Times.
TOBAM’s fund is not traded on an exchange and does not qualify as a European mutual fund known as a Ucit, according to the Financial Times. The fund does, however, have daily liquidity derived from market closing prices, a characteristic it shares with what are known as Ucits mutual funds.
French Regulator Grants Approval
TOBAM founder Yves Choueifaty said the fund required permission from France’s regulatory authority, Autorité des Marchés Financiers (AMF), to be launched. He also said the company had to convince the AMF the fund has a framework that protects investors.
Investing directly in bitcoin poses challenges in the choice of platform and in maintaining the security of custody in addition to protocol challenges, such as hard forks, according to Christophe Roehri, TOBAM’s head of business development.
The fund’s auditor is PwC and its custodian is Caceis, the asset servicing banking group of Credit Agricole.
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