Cameron Winklevoss, right, and his twin brother Tyler leave a federal appeals court in San Francisco, California, U.S., on Tuesday, Jan. 11, 2011. Facebook Inc.'s settlement of claims that its founder Mark Zuckerberg stole the idea for what became the world's largest social-networking website should be undone, former college classmates of Zuckerberg told an appeals court. Photographer: Noah Berger/Bloomberg
Cameron Winklevoss, right, and his twin brother Tyler leave a federal appeals court in San Francisco, California, U.S., on Tuesday, Jan. 11, 2011. Facebook Inc.'s settlement of claims that its founder Mark Zuckerberg stole the idea for what became the world's largest social-networking website should be undone, former college classmates of Zuckerberg told an appeals court. Photographer: Noah Berger/Bloomberg

The Winklevoss twins are looking to create an exchange-traded fund for the online currency Bitcoin. Their company, Math-Based Asset Services LLC, filed forms with the U.S. Securities and Exchange Commission yesterday.

The goal is to let traders and investors in on the roller-coaster ride that is Bitcoin -- without having to go through online currency exchanges, which are unregulated and tricky to access.

Cameron and Tyler Winklevoss, known for their claim to have co-founded Facebook Inc., own 1 percent of all outstanding Bitcoins, worth about $10 million. Their plan to make Bitcoin more mainstream has generated some skepticism about potential risk.

But the Winklevoss ETF's own filing makes the best arguments against treating Bitcoin as an investment asset.

1. "It may be illegal now, or in the future, to acquire, own, hold, sell or use Bitcoins in one or more countries, and ownership of, holding or trading in Shares may also be considered illegal and subject to sanction."

The risk that your investment could be outlawed isn't one you hear that often. An investment in Bitcoin ETF shares is ultimately a bet on which way U.S. and other regulatory authorities go on Bitcoin. With Mt. Gox, the largest Bitcoin exchange, in trouble with the Financial Crimes Enforcement Network, that's looking riskier by the day.

2. "As the Sponsor and its management have no history of operating an investment vehicle like the Trust, their experience may be inadequate or unsuitable to manage the Trust."

The Winklevoss twins were rowers, then technology investors. They aren't experienced managers of a financial product, let alone Bitcoin experts. Then again, nobody really is.

3. "The Trust’s internal systems rely on a Security System that is highly technical, and if such system contains undetected errors, the value of the Shares could be adversely affected."

A major draw to Bitcoin is the anonymity and security of direct personal transactions through encryption and digital transactions. That works against the currency when you trust someone else to invest for you.

The investment assets are hard to secure and to trace. A "Bitcoin trust" is somewhat of a contradiction in terms. If you're buying Bitcoin, you already have some trust issues.

4. "The Blended Bitcoin Price is based on the daily average of the high and low trading prices on various Bitcoin Exchanges in the Bitcoin Exchange Market chosen by the Sponsor."

Pay attention to the pricing method. The "blend" is determined by the average of highs and lows of an extraordinarily volatile, illiquid and opaque investment security. That's risky. It might not be all that difficult to manipulate the ETF's share value by briefly pushing up or down the price of Bitcoin to extreme levels.

Prospective investors should be more than a bit skeptical about putting coin in the Winklevoss ETF.

(Evan Soltas is a contributor to the Ticker. Follow him on Twitter.)