Bitcoin Investing Now Available on SecondMarket

Bitcoins may be under scrutiny -but that hasn’t stopped the Bitcoin Investment Trust from offering investment opportunities in the digital currency on SecondMarket.

SecondMarket is an alternative broker-dealer founded by Barry Silbert. The alternative trading system, usually reserved for trading startup stocks, invested $2 million in seed in the Bitcoin Investment Trust (BIT).

SecondMarket’s decision to develop a bitcoin investment opportunity was largely driven by demand from “financial professionals, technology entrepreneurs, and even gold enthusiasts” according to Mark Murphy, executive VP of communications.

These financial professionals and established institutions are exactly who the BIT is aiming for. BIT is just too risky of an investment for the average retail investor. By allowing only accredited investors, SecondMarket can avoid the hang-ups of regulatory oversight.

Silbert states “Bitcoin … faces regulatory uncertainty and widespread adoption issues that make investing in bitcoin a highly risky endeavor.”

The Bitcoin Investment Trust functions similarly to an exchange-traded fund.

In an interview on Boomberg TV, Silbert likened the BIT to “an early stage startup investment where you can either lose all of your money or the upside is enormous for what bitcoin could become.”

SecondMarket’s Bitcoin Investment Trust is not the only bitcoin ETF on the block. The Winklevoss twins, made famous for their tenuous relationship with Facebook, filed with the U.S. Securities and Exchange Commission for their own bitcoin ETF, which if approved, will be available to the public to trade on the stock exchange.