Israel Takes Bold Move Towards Bitcoin Mutual Funds

Israel is set to take the cryptocurrency investment stage by storm, as six Bitcoin mutual funds are scheduled for launch on December 31, 2024.

Israel will soon witness the launch of six Bitcoin mutual funds on December 31, 2024, marking a significant step in the country's cryptocurrency investment landscape. These funds will be managed by Phoenix Investment, More, Ayalon, IBI, Meitav, and Migdal Capital Markets.

The establishment of these funds has been a result of sustained lobbying efforts by asset managers seeking regulated Bitcoins in Israel. The funds will charge management fees ranging from 0.25% to 1.5%, with one actively managed fund aiming to generate a positive alpha relative to the price performance of Bitcoin.

The company will carry out the transaction daily, using the prevailing Bitcoin price at that time, and may later introduce continuous trading facilities. Investors will be able to buy the funds in Israeli shekels, granting them direct access to Bitcoin's performance.

This local initiative aligns with the global trend of increasing cryptocurrency adoption, as the U.S. SEC permitted spot Bitcoin ETFs earlier this year. These ETFs have attracted billions of dollars in institutional investments and hold over $110 billion in net assets, which is equivalent to 5.7% of Bitcoin's total market cap.

There has been a strong demand for Bitcoin products in Israel, with asset managers submitting proposals since 2024. Eyal Haim, vice president at Ayalon Mutual Funds, stated that they are showing interest in digital currencies and that this effort is ultimately for launching their funds to the benefit of investors.

These developments also coincide with broader initiatives in digital finance within Israel. The central bank is engaged in a digital currency project known as the digital shekel, which is part of the Digital Shekel Challenge. This initiative aims to foster banking competition through real-time payments.

As Bitcoin's price steadies from its recent highs, trading at $95,526.8 in the last 24 hours with a 2.70% decrease, the momentum for cryptocurrency investment continues on a global scale. These funds serve to bridge the gap between classical and digital finance in Israel, presenting local investors with opportunities for diversified portfolios within a regulated and accessible framework.