As Bitcoin, the math-based currency that enthusiasts say could revolutionize online transactions, becomes more mainstream, its supporters have been looking for ways to make it more accessible to investors.
It’s an open-ended fund that lets institutional and accredited investors dabble in the crypto-currency without necessarily having to go through the headache of managing wallets or direct transactions. It invests exclusively in Bitcoin and investors who buy shares in the trust will be able to gain liquidity through regular auctions beginning next year on SecondMarket.
Unlike the exchange-traded fund that Tyler and Cameron Winklevoss have been exploring, this one is only available to accredited investors, who are required to have higher annual incomes or net worth. Because this fund is only open to accredited investors, it doesn’t have to pass the same exploratory process that a wider ETF would need to go through with regulators.
SecondMarket says that the new trust’s sponsor is Alternative Currency Asset Management, a subsidiary the company created. They also put a $2 million seed investment into the trust.
It’s worth noting that Barry Silbert, SecondMarket’s CEO, has been a longtime enthusiast of the currency. He personally has made several angel investments in Bitcoin-related startups like BitPremier and Coinsetter.
Bitcoin is a math-based currency that some say could substantially lower online transaction costs. Its value as measured in U.S. dollars reached an all-time high earlier this year, the currency settled back at a lower range around $125 to 135. The market capitalization of all Bitcoins in circulation currently sits at around $1.5 billion.