Furthermore, the company asserts that its offering is one of the regulated assets facilitating exposure to Bitcoin’s price variations.
The offering intends to assist institutional and professional investors diversify their portfolio. The fund will utilize the price of futures traded on the CME (Chicago Mercantile Exchange) for settlement in cash.
The company further stated that it opted for cash settlements to avoid issues related to storing, securing and valuing Bitcoin. For the fund, the custodian is Financière d’Uzès, while the auditor is PwC, which is one of the ‘Big Four’ accounting firms.
According to the media release, the asset manager decided to create the product after understanding the capability of blockchain technology and Bitcoin:
“Convinced of the major transformation challenge carried by the blockchain for the entire industry, Napoleon AM got quickly interested in the financial potential of what intrinsically emanates from public blockchains, digital assets.”
The fund trusts that Bitcoin stands out as a unique asset considering its high volatility and minimum correlation to conventional assets. According to the fund, such features make Bitcoin ideal for diversification of portfolios to achieve best risk/return ratios.
There is a rising competition between funds to grab a share of market made up of institutional investors interested in investing in Bitcoin. To meet the expectations of accredited investors, Grayscal Bitcoin Trust, a publicly traded Bitcoin fund, submitted Form 10 with the US SEC (Securities and Exchange Commission) to turn into the first crypto fund to adhere to regulatory compliance mechanism.