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Bitcoin Funds Set to Debut
On December 31, six mutual funds tracking Bitcoin’s price movements will launch in Israel. These funds, approved by the Israel Securities Authority, will allow investors to gain exposure to Bitcoin through banks and investment firms.
Tracking Strategies and Management
The funds will follow various strategies, including mirroring Bitcoin’s price through indexes and tracking U.S. exchange-traded funds (ETFs) like BlackRock’s iShares Bitcoin Trust ETF (IBIT). One fund will be actively managed, aiming to outperform Bitcoin’s performance.
Market and Fees
The global market capitalization of Bitcoin ETFs currently stands at $143.2 billion as of December 25. In Israel, the funds will be managed by firms like Phoenix Investment, IBI-Kessem, Meitav, More, Ayalon, and Migdal. Management fees will range from 0.25% to 1.5%.
Regulatory Approval and Shekel Integration
After two years of applications, regulators approved these funds last week. Investors will now be able to buy and sell Bitcoin exposure in Israeli shekels, with transactions processed once daily based on Bitcoin’s current price.
Israel’s Broader Digital Currency Efforts
Since May, Israel has been working on its central bank digital currency (CBDC), the digital shekel, through the Digital Shekel Challenge. This initiative aims to develop real-time payment systems using the CBDC and foster competition among local banks. However, privacy concerns have been raised regarding the project.
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