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Napoleon Bitcoin Fund launches in France to cater institutional investors

French asset management company Napoleon AM has launched a new bitcoin fund tied to CME's cash-settled bitcoin futures.

Image: Napoleon Facebook

Thu, 12 Dec 2019, 06:46 am UTC

Napoleon AM, a French asset management firm, has announced the launching of its new bitcoin fund that is tied to the cash-settled bitcoin futures of the derivatives provider Chicago Mercantile Exchange (CME). Called the Napoleon Bitcoin Fund, the product will cater to institutional investors with a minimum buy-in of $110,000.

Additionally, interested parties should only reside in France and cross-border trades are not permitted. The fund aims exposure to bitcoin’s price movement without the need to hold the actual cryptocurrency, The Block reported.

“The fund aims to replicate the performance of Bitcoin via Futures listed on the Chicago Mercantile Exchange in cash settlement, thus avoiding the problem of storing and valuing Bitcoin,” Napoleon said.

Greenlighted by French regulatory agency

Although this isn’t the first time that French traders have been given the opportunity to invest in crypto-based financial products, the Napoleon Bitcoin Fund has leg up over its competition as it successfully acquired the green light from the AMF (Autorité des marchés financiers). The fund is also among the first to use cash-settled bitcoin futures that are tied to the CME.

Napoleon President Stephane Ifrah said that the launch is the result of the firm’s collaboration with the AMF and its partners. Financière d'Uzès has been chosen as the fund’s custodian and accounting firm PwC has been appointed as its auditor.

“We are proud to contribute to the institutionalization and democratization of digital assets through a unique regulated fund under French law,” Ifrah said.

An emerging rivalry

Meanwhile, CME’s rival, Bakkt, has also recently launched its own cash-settled futures product in Singapore. The product will follow a similar strategy that’s being used by the Intercontinental Exchange (ICE) on its Brent Crude Oil Futures Contract.

“These new contracts represent an important milestone in the development of this emerging asset class and our bitcoin product complex. Backed by the strong support and commitment of the Intercontinental Exchange team, we have great momentum going into 2020 and an exciting product roadmap that includes new trading products, an expanded custody offering, an innovative consumer payments app, and more,” Bakkt said

As for what France itself is planning, officials are currently looking into the development of its own central bank digital currency (CBDC). A trial run is slated to launch in the first quarter of 2020 to test the viability of this option and identify risks that need to be addressed.

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