Switzerland's FINMA Approves First Spot Bitcoin ETF for Retail Investors
Key Takeaways
- •FINMA approved Switzerland's first spot Bitcoin ETF for retail investors, and trading on the SIX Swiss Exchange is expected to begin in November.
- •BIT Asset Management said its Bitcoin Fund ETF (BBIT) holds Bitcoin directly and is approved for public offering only in Switzerland.
- •Unlike most European Bitcoin products, which are exchange-traded products (ETPs) carrying risk, the new fund is a collective investment scheme with assets ring-fenced for investors.
- •FINMA has permitted funds investing primarily in cryptocurrency baskets since 2021, but this is the first approval of a fund investing solely in Bitcoin, citing the asset's trading history and higher trading volume.
- •The approval places Switzerland alongside the United States, where the first spot Bitcoin ETFs began trading in January 2024, though FINMA stressed that Bitcoin remains highly volatile.
Switzerland's financial regulator, FINMA, has approved the country's first spot Bitcoin exchange-traded fund (ETF) for retail investors, with trading expected to begin in November.
On Tuesday, FINMA announced that it had approved the first Swiss spot Bitcoin ETF investing directly in Bitcoin, though it did not disclose the identity of the issuer. Two days later, on Thursday, BIT Asset Management said its Bitcoin Fund ETF (BBIT) is expected to begin trading on the SIX Swiss Exchange, Switzerland's principal stock exchange, next month. The fund holds Bitcoin directly and has been approved for public offering in Switzerland only.
"Most bitcoin products listed in Europe today are exchange-traded products (ETPs), which are debt instruments that carry issuer risk," BIT Asset Management said. By contrast, the Bitcoin Fund ETF is structured as a Swiss collective investment scheme in which assets are held separately from those of the fund management company and are "ring-fenced" for investors, the firm added. The distinction matters for investors: an ETF is a fund that holds the underlying asset, whereas an ETP is a debt security whose payout depends on the issuer meeting its obligations.
The fund falls under Switzerland's "other funds for alternative investments" category with particular risk. FINMA noted that other fund providers have also submitted applications for Bitcoin ETFs, so further regulatory decisions on similar Swiss products may follow.
The regulator has permitted funds investing primarily in a basket of cryptocurrencies since 2021, but this marks the first time it has approved a fund that invests solely in Bitcoin, citing the asset's trading history and higher trading volume compared with other cryptocurrencies. The approval puts Switzerland alongside the United States, where the first spot Bitcoin ETFs were cleared by the Securities and Exchange Commission and began trading in January 2024. FINMA nevertheless stressed that Bitcoin remains highly volatile, even when accessed through an approved ETF.
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