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Once again the Winklevoss twins get beaten launching their big idea: a bitcoin trust

Mark Zuckerberg beat the twins Cameron and Tyler Winklevoss to the punch in launching Facebook. Now someone else seems to be stealing a march on their plan to launch an investment scheme for bitcoin.

SecondMarket, an American online marketplace, announced today that it’s launching a new bitcoin trust—a way for companies and rich people to invest in the virtual currency. It’s a structure that looks not unlike the bitcoin exchange-traded fund (ETF) announced in July by the Winklevoss twins; but while there’s no date set for the launch of the Winklevoss ETF, SecondMarket’s trust is raising capital now, though investors won’t start trading shares until early 2014.

Called simply Bitcoin Investment Trust (BIT), the new fund will essentially buy a bunch of bitcoins (SecondMarket has so far put $2.25 million of its own money into doing so), and investors will buy shares in the trust, much as they would in an ETF. However, it will be open only to institutional investors, such as pension funds, and “accredited investors,” people who make more than $200,000 per year or are worth more than $1 million excluding their primary residence.

For most investors, bitcoin is a big hassle to invest in. Though some enthusiasts do it on a regular basis, many—particularly in the US—have to jump through a legal obstacle course. One bitcoin day trader told Quartz he has to trade through a Japanese bank and show up in person at the bank’s New York headquarters to move his money to a US bank account. The legal woes of Mt. Gox, the largest bitcoin exchange to date, have a lot to do with this; bitcoin users have seen weeks-long delays in receiving their cash ever since the US Department of Homeland Security temporarily froze money in Mt. Gox’s bank accounts in May.

The Winklevii’s scheme, unlike SecondMarket’s, is for a public ETF traded on a major exchange open to retail investors. But the SEC may not approve it any time soon because it has yet to work out oodles of legal questions about the cryptocurrency. At a conference last week, the brothers were vague, telling attendees that regulators could set parameters on bitcoin “over the next 6 to 12 months.” Bitcoin enthusiasts and investors have scoffed.

By restricting its fund to rich people and institutions, SecondMarket avoids many of the regulatory hurdles. “The ETF approval process can take years to go through for even more established commodities like diamonds or copper, ” SecondMarket spokesman Mark Murphy told Quartz. A diamond ETF has been in the works for years, and its supporters have only recently scored steps that could lead to its approval. “From a risk-profile vantage point bitcoin is very risky and we think it’s not appropriate for retail investors,” Murphy added.

And SecondMarket has another thing going for it. New rules from the SEC—which SecondMarket lobbied for, and which came into force this week—will allow the trust to advertise for investors, something previously forbidden. Looks like it’s back to second place for the Winklevii.

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