Canadian investment fund manager 3IQ Corp has announced that it has received "favourable ruling" from the Ontario Securities Commission (OSC) for "The Bitcoin Fund," a non-redeemable investment fund that is expected to be listed for trading on major Canadian stock exchanges. According to 3IQ Corp, OSC has instructed its director to "issue a receipt for a final prospectus" of The Bitcoin Fund. 3IQ Corp hopes to have the fund listed for trading in the fourth quarter of 2019.
The Bitcoin Fund provides investors exposure to bitcoin through a long-term holding strategy of bitcoins sourced from firms, including bitcoin exchanges. Because the fund is a non-redeemable investment fund (NRIF), it enables 3IQ Corp to invest in assets not permitted for mutual funds. As an NRIF, however, The Bitcoin Fund limits the redemption rights of its investors. Investors of the fund will have the right to redeem their investments at net asset value annually, or redeem them monthly at a discount.
“Over the past three years, we have worked actively with the OSC’s Investment Funds and Structured Products Branch to create an investment fund that we hope will allow retail investors the benefits of investing in bitcoin through a regulated, listed fund,” said Fred Pye, President & CEO of 3iQ. “We have addressed the questions of pricing, custody, audit, and public interest issues in a regulated investment fund. We intend to refile the prospectus as soon as possible as the next step in bringing this ground breaking fund to investors.”
Gemini will act as a custodian for the bitcoins in The Bitcoin Fund. “3iQ has carefully selected a team of professional partners with expertise in the digital asset industry to construct a safe and secure fund product for the Canadian market, and we are excited to be selected as their custodian,” said Cameron Winklevoss, President of Gemini.
Earlier this year, the OSC refused to issue a receipt for the fund's prospectus citing the lack of compliance with Canadian regulations and that it was "not in the public interest to do so."