Management company ProFunds has launched "the first US mutual fund to reflect bitcoin dynamics before expenses are paid".
ProFund's Bitcoin Strategy involves buying CME-traded futures on the first cryptocurrency. No direct purchase of digital gold is envisaged. The CF Bitcoin-Dollar US Settlement Price Index is used as a benchmark.
The instrument is available under the ticker BTCFX.
The offer allows investors to diversify portfolios with bitcoin without having to hold coins on an exchange or in a wallet.
"Bitcoin Strategy ProFund gives access to the first cryptocurrency with a shell familiar to tens of millions of investors," the press release states.
The minimum entry threshold is $1,000 and the Total Expense Ratio is 1.15% (1.47% from 30 November 2022).
Established in 1997, ProFunds manages $60bn in assets, offering clients a variety of mutual funds based on stocks, bonds, commodity contracts, currencies and other assets.
Eric Balčunas, a senior exchange-traded fund analyst at Bloomberg, was taken aback by the news of ProFund's Bitcoin Strategy launch. He could not find an answer as to why the company was able to launch its product while the applicants of an ETF with the same mechanism in the form of bitcoin futures could not.
Bitcoin futures mutual fund launching today from ProFunds. Still trying to figure out the catch and/or why this ok but bitcoin futures ETF isn’t.
As a reminder, in July Coinbase predicted approval of a bitcoin ETF in the US this year or next year.
Earlier, the SEC deferred consideration of proposals for the launch of a similar instrument from SkyBridge Capital, VanEck, Kryptoin Investment Advisor, Valkyrie Digital Assets and WisdomTree.