The fund will invest in crypto-currencies such as bitcoin, ether and ripple.

Swiss firm Crypto Fund will launch the Cryptocurrency Fund, which it says is Europe’s first diversified investment fund for digital assets. This announcement comes just months after the US Securities and Exchange Commission rejected a request from the Winklevoss twins to list the first US exchange-traded fund designed to track the controversial crypto-currency bitcoin.

The new fund will be based on the Crytocurrency Index and will invest in crypto-currencies such as bitcoin, ether and ripple, the firm said yesterday in a statement.

It will be managed by the chief executive of Crypto Fund, Jan Brzezek, former president of UBS Asset Management and UBS Group Europe, Middle East and Africa. He will be supported by founder and chairman Tobias Reichmuth, and investor Marc Bernegger. The firm will announce more senior banking industry professionals who will support the growth of the fund.

Cryptocurrency Fund will offer an index-based, passive product in accordance to the Swiss Collective Investment Schemes Act (KAG), which provides regulated access to cryptocurrencies for professional investors.

According to the firm, the crypto-currency Fund “will be the first regulated fund globally, which provides a safe and easy access to the rapidly growing cryptocurrency world”. It will be registered with the Swiss regulator FINMA, and initial discussions have already taken place.

"We recognised the growing demand of qualified investors for a regulated and transparent gateway to cryptocurrencies and realised that we need to adopt this new underlying to a proven and recognized legal framework allowing qualified investors to invest in cryptocurrencies,” said Brzezek. “Unlike the Winkelvoss-ETF, which was rejected by the SEC, we use the regulated and proven Swiss fund structure according to KAG, where the asset manager, the fund management company and the custodian bank are legally separate from each other. The fund will be highly diversified and will not list on an exchange and exclusively target qualified investors.” 

The launch of the fund is expected for the fourth quarter of the 2017 financial year. 

The announcment may come as a surprise to some, as Tyler and Cameron Winkelvoss had tried for three years to persuade the SEC to approve their bitcoin ETF prior to their application being rejected in March 2017.