Switzerland's regulator FINMA has approved the first Swiss-law retail exchange-traded fund that invests directly in bitcoin. It exempted the fund from risk-diversification rules but requires custody safeguards and clear warnings about volatility and losses.
FINMA said on Oct. 20 that it has approved the first Swiss-law retail ETF investing directly in bitcoin. The release did not identify the fund, its sponsor, management company or custodian, and it gave no launch date or redemption terms.
The approval adds a retail-eligible Swiss fund structure to a market where investors already trade crypto exchange-traded products. Those ETPs are collateralized debt securities rather than investment funds, according to SIX Swiss Exchange. FINMA's first Swiss crypto fund, approved in 2021, was restricted to qualified investors.
A diversification exemption for bitcoin
The regulator classified the ETF as an "other fund for alternative investments" with a specific risk under Swiss law. It granted an exemption from the applicable risk-diversification rules, citing bitcoin's long trading history and particularly high trading volume compared with other cryptocurrencies.
Custody and disclosure requirements
Supervised institutions must mitigate operational and custody risks under FINMA's Jan. 12, 2026 guidance, which the approval announcement cites. That guidance requires Swiss collective investment schemes to entrust fund assets to a Swiss custodian bank. Delegating crypto custody to a third party is permitted if it is subject to equivalent prudential supervision and equivalent bankruptcy protections for the cryptoassets.
FINMA also requires fund documents to highlight and explain risks clearly. Firms offering crypto-based financial instruments must comply strictly with the Financial Services Act's sales-conduct rules, including clear warnings about volatility and losses.
Market risk remains
The approval does not remove bitcoin's market risk. FINMA warned that investors could still lose a substantial amount of their capital through an approved ETF.
Other fund providers have also submitted or announced applications for bitcoin ETFs, the regulator said.
Source: The Defiant
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