Bitcoin Fund Gains Mainstream Acceptance, Including by Retirement Savers

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Bitcoin Fund Gains Mainstream Acceptance, Including by Retirement SaversBitcoin is fast entering the U.S. retail fund sector, even retirement accounts, much to the disapproval of financial advisers.

New York-based trading platform SecondMarket, which last year unveiled a Bitcoin fund targeted at wealthy and institutional investors, plans to offer the service to less-sophisticated clients in the fourth quarter.

The company plans to list its Bitcoin investment trust (BIT) on the OTC Markets’ electronic exchange OTCQX as soon as it obtains the necessary approvals from the Financial Industry Regulatory Authority and the OTC Markets.

“Any investor in the US with a retail brokerage account will be able to buy shares,” Barry Silbert, the CEO of SecondMarket, told Financial Times.

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Modelled on the SPDR Gold Shares exchange-traded fund, the BIT monitors the Bitcoin price shifts and offering dollar-denominated coverage to the virtual currency without having to store or purchase it directly. The fund’s auditors are Ernst & Young, and it states that its Bitcoins are secured by a “state of the art” security.

Assets totalled $45.9 million as of the beginning of April. However, some financial advisors are worried about the readily-available Bitcoin fund

“I don’t even know what to say,” says Kim Forrest, a Pittsburgh-based senior equity analyst at investment advisor Fort Pitt Capital Group “I get that people want to have some non-government affiliated store of value, but this really is not it. This is something that is totally fabricated.”

Retirement funds constitute the largest proportion of investors in BIT, totalling 16 percent of the trust. Some high profile clients include Entrust Group, Pensco Trust and Millennium Trust. To register for a free 2-week subscription to ForexMinute Premium Plan, visit www.forexminute.com/newsletter.

To contact the reporter of this story; Deepak Tiwari at deepak@forexminute.com