6 mutual funds tracking Bitcoin prices will officially trade in Israel starting December 31, marking a new advancement in the country's access to the cryptocurrency market.
On December 25, the Israel Securities Authority (ISA) officially licensed 6 mutual funds tracking Bitcoin prices to operate, opening the door for local investors to more easily access the cryptocurrency market.
These funds, expected to launch on December 31, will be offered through banks and investment companies nationwide, allowing trading in shekels, Israel's currency. This is seen as an important step, reflecting the increasing acceptance of digital assets by regulatory authorities.
Diversifying investment options
These 6 new funds will track Bitcoin prices through various strategies, meeting the diverse needs of investors. Some funds will closely follow the performance of Bitcoin ETFs listed in the U.S., such as BlackRock's iShares Bitcoin Trust ETF (IBIT). Another fund will be actively managed with the goal of outperforming Bitcoin's performance. As of December 25, the total market value of global Bitcoin ETFs reached approximately $143.2 billion, indicating significant growth potential for this market.
The above funds are managed by major names in the mutual fund management industry in Israel, including Phoenix Investment, IBI-Kessem, Meitav, More, Ayalon, and Migdal. Management fees will range from 0.25% to 1.5%, providing various options suited to the risk appetite and financial capacity of each investor. The approval was issued after 2 years of efforts by asset managers to obtain licensing, demonstrating their perseverance and long-term vision for the cryptocurrency market.
In the early stages, buying and selling will be conducted once a day, with the Bitcoin price updated at the time of the transaction. Mr. Eyal Haim, Vice President of Ayalon Mutual Funds, shared with Calcalist: “For many years, we have strived to engage in the cryptocurrency sector. The launch of a mutual fund investing in companies related to cryptocurrencies is the first step and a significant advancement, allowing us to meet the growing demand of investors for this type of asset.”
The event takes place against the backdrop of Israel actively implementing the central bank's digital currency (CBDC) development project named “Digital Shekel Challenge” since May. This project encourages participants to develop a real-time payment system using the digital shekel, with support from the Bank of Israel through a sandbox testing environment.
The main goal of the CBDC project is to enhance competition in the banking sector while exploring the potential of blockchain technology to improve efficiency and reduce transaction costs. However, the project is also facing concerns about privacy, an issue that needs to be carefully considered during implementation.
