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A French asset management company launches Bitcoin's first mutual fund in Europe

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TOBAM, a French-based asset management company, has launched a bitcoin investment fund to offer an alternative investment to institutional investors exposure to bitcoin. The fund, according to the company, is not regulated.

TOBAM's bitcoin fund precedes Chicago Mercantile Exchange's plans to list bitcoin futures. In seeking to address the challenges investors have faced in gaining exposure to bitcoin, the fund incorporates blockchain fork management and is taking steps to mitigate the risk of loss and theft, according to the TOBAM website.

Bitcoin, while volatile, offers investors diversification, according to TOBAM.

Access for Institutional Investors

Bitcoin, which is not regulated by national financial regulators like the Securities and Exchange Commission in the United States and the Financial Conduct Authority in the United Kingdom, can not be held by most negotiated funds on the stock market or through traditional mutual funds. Financial Times.

The TOBAM fund is not traded on the stock market and is not qualified as a European mutual fund known as Ucit, according to the Financial Times. The fund does, however, have daily cash flow derived from market closing prices, a feature it shares with what Ucits is known as mutual funds.

Approval of the subsidies of the French regulators

The founder of TOBAM, Yves Choueifaty, declared that the fund required the authorization of the Autorité des Marchés Financiers (AMF). He also said that the company had to convince the MFA that the fund has a framework that protects investors.

Investing directly in bitcoin poses challenges in choosing the platform and maintaining guard security in addition to formal challenges, such as hard forks, according to Christophe Roehri, commercial development manager at TOBAM .

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The auditor of the fund is PwC and its custodian is Caceis, the banking group managing the assets of Crédit Agricole.

Choueifaty said that he would be disappointed if the fund did not exceed $ 400 million in two or three years. The founder of TOBAM also believes that cryptocurrencies will set sustainable standards in the savings and finance markets.

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Investment Philosophy of TOBAM

TOBAM, which manages $ 8.8 billion in fixed-income and equity securities according to its website, adopts a diversification approach that uses patented research and the mathematical definition of diversification to offer exposure bond markets and equities.

"Our goal is to take control of these operational challenges in order to facilitate access for skilled investors wanting to gain exposure to bitcoin," Roehri said. "All this in the form of a fund."

Traditional financial advisors and portfolio managers have argued that most institutional investors are far from considering investing in bitcoin. Launched in 2005, TOBAM is owned by employees. The California Public Employees Retirement System and Amundi have been minority shareholders since 2011 and 2012, respectively. The team has 49 professionals from 17 countries.

TOBAM has been developing cybersecurity systems for the past 12 years. Its development team includes researchers, risk management specialists, engineers and computer scientists. In addition to being regulated by the Autorité des Marchés Financiers, TOBAM is a registered investment advisor to the SEC. It is also registered in Canada and South Korea.

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