"Bitcoin fund" is one of the bigger crypto searches in Israel, with Hebrew autocomplete adding "Israeli", "shekel" and "currency-hedged". The reason is simple. Since 31 December 2024, Israelis have been able to buy exposure to the bitcoin price from the same account they use for shares and mutual funds, in shekels, without opening a crypto exchange account or explaining to the bank where the money came from.
But a bitcoin fund and actual bitcoin are two different products, with different fees, different tax handling, different trading hours and different risks. This guide goes through those differences in detail. We will not recommend a specific fund, and we will not tell you whether to buy bitcoin at all. The aim is for you to know exactly what you are buying.
What an Israeli bitcoin fund is
In December 2024 the Israel Securities Authority approved six mutual funds that track the bitcoin price, and they began trading on 31 December 2024. The managers are Ayalon, IBI, Meitav, More, Migdal and Phoenix. Some funds follow S&P or CME bitcoin indices, some follow the US bitcoin fund IBIT, and one is actively managed. All of them are bought in shekels from any investment account at a bank or brokerage.
A point of precision: these are mutual funds, not exchange-traded funds (ETFs) that trade throughout the day. At launch they were priced once a day. We could not confirm whether any crypto ETF or exchange-traded note has launched in Israel since. The Israel Securities Authority's role is to supervise the funds, as it does any mutual fund. It does not license crypto exchanges. That is the job of the Capital Market, Insurance and Savings Authority.
| Fund manager | Fund name (as reported at launch) | Number | Management fee |
|---|---|---|---|
| IBI | S&P Bitcoin | 5139910 | 0.25% |
| Meitav | CME CF Bitcoin Reference Rate | 5139787 | 0.25% |
| Migdal | Indxx Bitcoin Reference | 5139886 | 0.25% |
| Ayalon | Shekel Bitcoin Exposure | 5139845 | 0.8% |
| Phoenix, More | Not detailed in the sources we checked | — | Not detailed |
Per Bizportal (24 Dec 2024) and launch coverage. Not a recommendation. Fees can change; check the prospectus and fund filings on maya.tase.co.il.
Bitcoin fund vs real bitcoin: the core difference
When you buy bitcoin, you hold a coin. You can move it to your own wallet, send it to a friend abroad, sell it at 2am or swap it for another coin. When you buy fund units, you hold an Israeli security whose price is designed to follow bitcoin. You cannot withdraw a coin from it, pay with it or move it to a wallet.
On the other hand, the units sit in your investment account next to your shares and bonds, and the money never leaves the bank. There is no recovery phrase to lose, no foreign exchange without an Israeli licence and no trail of transfers to explain. Under Bank of Israel Directive 411, above roughly ₪100,000 a year of crypto activity a bank is expected to look closely at the source of funds. With a fund that problem simply does not arise, because as far as the bank is concerned you bought a mutual fund.
Fees: what costs more over time
The structures differ. A fund charges an annual management fee, from 0.25% at the cheapest funds to over 1% at others, plus whatever your bank or broker charges to buy and sell, which varies from bank to bank. With direct ownership you pay mostly on the way in and out. At Bits of Gold the service fee is 1.95% plus VAT at the entry tier, about 2.3% all-in. On Bit2C Pro it starts at 1.25% and falls with volume. If you leave a Bit2C balance with no activity in the previous month, you may pay a custody fee of up to ₪7 a month.
The rough conclusion: over a short period, a low-cost fund usually wins. Over several years, a management fee of 1% or more adds up, and buying directly somewhere cheap can work out better, provided you do not trade a lot. Do not rely on our arithmetic, though. Check the fund's actual fee and your own bank's commissions.
Tax: a bitcoin fund vs holding bitcoin directly
Same rate, different handling. In both cases a gain on sale is subject to capital gains tax at 25% for individuals, or 30% for a substantial shareholder.
The difference is who calculates and who reports. With a fund it is usually the bank. With crypto, in most cases, it is you.
With an Israeli mutual fund, as with any security in an Israeli investment account, the bank or broker usually withholds capital gains tax at source when you sell, offsets losses within the same account and issues an annual statement (Form 867) for your return. For most salaried people that means there is little else to do. Switching from one fund to another is a sale, so it is a taxable event too.
With bitcoin held directly, Income Tax Circular 05/2018 treats every sale and every swap of one coin for another as a taxable event, and a foreign exchange will not withhold anything for you. You have to work out the gain against your purchase cost, report it and pay. Some Israeli platforms make that easier: Bits of Gold offers tax deduction and reporting and issues an annual report similar to Form 867, and Bit2C is piloting a service that pays the tax straight from your account. Above annual income of roughly ₪721,560, a surtax applies in both cases. Our full crypto tax guide.
Trading hours and custody: who holds what
Bitcoin trades 24 hours a day, seven days a week. Mutual funds trade only on Tel Aviv Stock Exchange trading days, and at launch they were priced once a day. In practice, if the price moves sharply on a Saturday night or a public holiday, a fund holder can only act on the next trading day, at the price set then. For a long-term holder that barely matters. For someone who wants to react quickly, it is a real difference.
On custody, with a fund you never touch a coin. The fund manager is responsible for the exposure, and your units are registered in your investment account like any other security. You have no key to lose and no wallet of yours that can be hacked. With direct bitcoin, either an exchange holds the coin for you, which exposes you to that exchange's risk, or you hold it yourself, in which case the responsibility is entirely yours. Our crypto wallet guide.
Who a bitcoin fund suits, and who direct bitcoin suits
A fund may suit someone who wants a small bitcoin allocation inside an existing portfolio, does not want to manage wallets or passwords, wants the bank to handle the tax and does not want the bank asking questions about crypto money. It can also suit someone who already keeps most of their savings at the bank and wants everything in one place.
Direct bitcoin may suit someone who wants to hold a real coin and move it, trade at any hour, buy other coins as well, or keep it in their own wallet without depending on a financial institution. Anyone choosing that route needs to be ready to keep records and to deal with bank questions on the way back. Compare crypto exchanges.
One more change is on the horizon. In August 2026 Bank Leumi announced that Leumi Trade and PEPPER customers will be able to buy and sell bitcoin, ether and solana in the app, with Galaxy as partner, from early 2027 and subject to Bank of Israel approval. If that happens, it creates a third route: the real coin, inside your bank. Crypto and Israeli banks.
How to check a bitcoin fund before you buy
- Find the fund by name or number
On the Tel Aviv Stock Exchange site or your bank’s trading app. The fund number is the safe way to make sure you are looking at the right product.
- Read the prospectus and filings
Maya publishes the prospectus, the current management fee and the investment policy: which index the fund tracks, whether it hedges dollar exposure and whether it is actively managed.
- Check your bank’s commissions
Buy and sell commissions on mutual funds vary between banks and brokers. On a small amount they can exceed the annual management fee.
- Understand when your order executes
A mutual fund order is filled at the price set on the trading day, not at the price you saw when you placed it.
- Decide how much of your portfolio it should be
A bitcoin fund is as volatile as bitcoin itself. If you are unsure how much to allocate, that is a question for a licensed investment adviser, not an information site.
A bitcoin fund is the quietest way for an Israeli to get exposure to the price. It does not give you what makes bitcoin interesting, but it also spares you most of the headaches: wallet, tax and bank.
If you want to hold the coin itself, do it on a platform you have checked, with full records from day one. Our beginner’s guide.
Frequently asked questions
What is an Israeli bitcoin fund?
An Israeli mutual fund that tracks the bitcoin price and is bought in shekels from an ordinary bank or brokerage investment account. Six such funds, from Ayalon, IBI, Meitav, More, Migdal and Phoenix, started trading on 31 December 2024 after approval from the Israel Securities Authority. You own fund units, not bitcoin.
Bitcoin fund or buying bitcoin directly: which is better?
It depends on what you want. A fund suits someone who wants price exposure inside a bank account, with no wallet and no source-of-funds questions. Buying directly suits someone who wants to hold a real coin, move it, trade at any hour or buy other coins. We do not recommend any particular fund or coin.
What management fees do Israeli bitcoin funds charge?
According to launch coverage, annual management fees range from 0.25% to more than 1%, with sources putting the top of the range at 1.25% to 1.5%. Your bank or broker may also charge buy and sell commissions. Check the current fee in the fund’s prospectus and filings on the Tel Aviv Stock Exchange’s Maya system.
How is a bitcoin fund taxed compared with bitcoin?
In both cases a gain on sale is subject to 25% capital gains tax for individuals. With an Israeli mutual fund, the bank usually withholds the tax at source when you sell and offsets losses within the same account. With bitcoin held directly, you calculate and report it yourself, and swapping between coins is also a taxable event. Confirm your own situation with a tax adviser.
When can I buy and sell a bitcoin fund?
Mutual funds trade only on Tel Aviv Stock Exchange trading days, and at launch they were priced once a day. Bitcoin itself trades 24 hours a day, every day. If the price moves sharply on a Saturday, a fund holder can only act on the next trading day, at the price set then.
Sources
- The Block: Israel Securities Authority sets 31 Dec launch for six bitcoin funds · December 2024
- Cointelegraph: six bitcoin funds receive approval in Israel · December 2024
- Bizportal: the bitcoin funds and their fees (Hebrew) · 24 December 2024
- Tel Aviv Stock Exchange · Checked October 2026
- Maya, the TASE filings system · Checked October 2026
- Israel Securities Authority · Checked October 2026
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