Luxembourg says it is the first Eurozone country to put public money into Bitcoin. In October 2025, the Intergenerational Sovereign Fund of Luxembourg (FSIL) allocated 1% of its €764 million portfolio — about $9 million — to Bitcoin ETFs. The move follows a 2025 policy review that lifted the ceiling for alternative assets to 15%.
FSIL is the first state-owned fund in the Eurozone to gain direct Bitcoin exposure through exchange-traded products. The purchase sits inside a revised mandate that permits wider diversification, and the exact slice was 1% of the total fund, equal to roughly $9 million.
The fund chose regulated ETFs to sidestep operational and custody hazards that accompany direct crypto holdings; an ETF is a fund that tracks an asset and trades on an exchange.
The event against a wider European backdrop, noting that new digital asset rules took force and public discussion shifted. Against large asset managers, the decision carries symbolic weight beyond its dollar size, yet it stands as an institutional first.
The key for the FSIL investment
The FSIL allocation may speed institutional uptake in Europe and influence Bitcoin liquidity and legitimacy. The asset remains volatile and that ETFs as well as direct holdings expose investors to different counterparty risks.
Analyst forecasts suggest that if other state funds copy similarly small slices, the net effect on Bitcoin supply and demand could be material, though the outcome hinges on market variables.
Luxembourg’s move sets a regulatory and operational reference for the Eurozone. The open question is whether other sovereign funds will match the allocation before the end of 2025; if they do, traditional portfolio models may shift.
