Six Bitcoin-tracking funds are set to launch in Israel next week, marking a major development in the nation’s cryptocurrency investment landscape.
The funds, approved by the Israel Securities Authority, will begin trading on December 31 and will be accessible through banks and investment firms.
The funds aim to replicate Bitcoin’s price movements using various indices and strategies.
Some will track exchange-traded funds (ETFs) launched in the United States, including BlackRock’s iShares Bitcoin Trust ETF (IBIT), while one of the funds will be actively managed to outperform Bitcoin’s returns.
As of December 25, the combined market capitalisation of Bitcoin ETFs globally stands at over $100 billion.
These new Israeli funds are being launched by leading mutual fund managers, including Phoenix Investment, IBI-Kessem, Meitav, More, Ayalon, and Migdal.
Management fees for the funds will range from 0.25% to 1.5%. Initially, transactions will be limited to one daily buy or sell order, reflecting Bitcoin’s price at that moment.
The approval for these funds follows two years of persistent requests from asset managers, providing local investors with exposure to Bitcoin priced in the Israeli shekel. This initiative coincides with Israel’s ongoing exploration of a central bank digital currency (CBDC).
Since May, the Bank of Israel has been developing its digital shekel under the “Digital Shekel Challenge.”
The project encourages participants to create real-time payment systems using the digital currency, supported by a sandbox testing environment.
The digital shekel initiative aims to boost competition among local banks while addressing privacy concerns raised by the public.
The introduction of Bitcoin-tracking funds and the progress on the CBDC underscore Israel’s efforts to integrate cryptocurrency and blockchain technologies into its financial ecosystem.
The rise of Bitcoin ETFs
The launch of Bitcoin-tracking mutual funds in Israel comes at a time when crypto-based exchange-traded funds (ETFs) are experiencing remarkable success globally.
Since their approval in January, US spot Bitcoin ETFs have rapidly gained traction, attracting billions in investor inflows and establishing themselves as prominent financial products in the cryptocurrency sector.
According to data from SoSoValue, U.S. spot Bitcoin ETFs have garnered total inflows of $35 billion and collectively manage assets exceeding $100 billion.
BlackRock’s iShares Bitcoin Trust (IBIT) leads this thriving market, reflecting strong investor confidence and growing demand for cryptocurrency-based financial instruments.
Crypto ETF offerings are also continuing to evolve.
Just last week, The cryptocurrency market achieved a major milestone with the approval of two groundbreaking ETFs by the US Securities and Exchange Commission (SEC).
The Hashdex Nasdaq Crypto Index US ETF and the Franklin Crypto Index ETF stand out by offering a unique proposition, combining spot Bitcoin and Ethereum investments into a single, streamlined package.
These ETFs are expected to enhance accessibility for investors looking to gain exposure to the top cryptocurrencies, offering a more convenient way to invest in digital assets through traditional financial markets.
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