The Index Fund is the first such investment product to be authorised in Switzerland
The Swiss Financial Market Supervisory Authority (FINMA) has approved the first crypto index fund in Switzerland, the supervisory authority announced on Wednesday.
“For the first time, FINMA has approved a Swiss fund that invests primarily in crypto assets, i.e. assets that are listed on the Blockchain– or distributed ledger technology”, so the regulator in a notice on its website.
The product with the name “Crypto Market Index Fund” is tailored exclusively to qualified investors and its admission is based on Swiss law, according to the authority’s notification. According to FINMA, the fund falls under the group of ‘other fund for alternative investments’.
The Swiss Financial Market Supervisory Authority further informed that the procedure for approving new financial products “existing provisions” of the law and that the goal is to ensure that they promote serious innovation. To achieve this goal, the regulator applies legal principles that limit the use of new technologies in the possible circumvention of established rules.
In the specific case of the Crypto Markets Index Fund, FINMA explained that it bases the approval on the fulfilment of the applicable requirements with regard to cryptoassets.
Thus, the provider of the fund, Crypto Finance, was commissioned to invest only in major cryptocurrencies that “sufficiently large trading volumes” gaps.
Other regulatory requirements that must be met include that the fund be managed through established counterparties and crypto platforms based in a country that is a member of the Financial Action Task Force (FATF). The installations must also ensure compliance with the applicable anti-money laundering (AML) regulations.
Crypto Finance has announced that Swiss firm PvB will manage the new fund, with SEBA Bank providing custodial services. The cryptoasset fund will map the crypto market index 10, which is currently monitored by the leading investment provider SIX Swiss Exchange.