At the end of last month, the crypto investment house, Silver Castle, announced that it had reached a memorandum of understanding with the Canadian fund company Purpose for the marketing of funds that follow the price of Bitcoin and the price of Ethereum in Israel. Various entities in the Israeli market tried in the past to establish crypto funds, and stopped after receiving cold opinions from the regulators. So there is an announcement of a joint venture between Silver Castel and the Canadian company, but when will we see these funds on the market? The road to get there is long.
Silver Castell offers a fund (Canadian) on the spot price of Bitcoin, i.e. tracking the price of Bitcoin. In the US, companies that wish to offer funds on the spot price of a cryptocurrency encounter difficulties; the regulator refuses to approve them on the grounds that in a market that is based on so many trading arenas, in some of which the trading is not deep and the activity in which affects the exchange rate very easily, it is difficult to know what the spot price of The Bitcoin.
The regulator in the USA has approved a fund that tracks the prices of Bitcoin futures contracts, but this is not attractive due to the cost of rolling the contracts.
Non-US fund companies, such as Canada’s Purpose, which offer spot bitcoin price tracking, typically use the prices published by the Chicago Stock Exchange as the representative crypto prices.
After the signing of the memorandum of understanding, Silver Castel also encountered opposition from the Israel Securities Authority to its Canadian partner, claiming that it does not meet the criteria established by the Authority for cooperation.
At the same time, Silver Castel is working to establish a fund on its own, and for this purpose signed a memorandum of understanding and cooperation with MKT MediaStats, an AI platform that analyzes data coming from the markets, including social networks, and formulates insights about investor sentiment. The purpose of the collaboration is to build data-based investment strategies, and integrate them into various Silver Castel products. The venture includes the establishment and management of a fund, within which Silver Castel will establish the fund and MKT will be responsible for research, strategy and data development.