A university professor at Warwick Business School has slammed the Winklevoss twins' attempt to build the first exchange traded product (ETP) in Bitcoin, claiming that it will damage the virtual currency’s chances of acceptance.

Cameron and Tyler Winklevoss, best known for their epic legal battle with Mark Zuckerberg over ownership rights to Facebook, reportedly hold $10 million (£6.5 million) of Bitcoin and have filed paperwork to create an ETP that will track the price of the virtual currency.

Yesterday it was reported that the pair have set up The Winklevoss Bitcoin Trust and plan to sell $20 million (£13m) of shares to investors. The shares will offer exposure to the yo-yoing price of Bitcoin with, the twins claim, minimal credit risk.

But Professor Rushman, of Warwick Business School, feels that neither investors nor the Bitcoin movement will be well served by the twins' plans.

“It is not going to help Bitcoin's quest for respectability to have associations with such thoroughbred vulture capitalists,” said Professor Rushman, who worked at BlackRock and Barclays Global Investors before moving into academia and teaching finance.

“The less people think of Bitcoin as a ‘get rich quick’ investment, the better its chances of survival. For its own sake, it needs publicity for its qualities as a neutral and universally accessible currency with a transparent exchange rate and immunity from central bank manipulation.”

He added that most people who are keen on Bitcoin as an investment already hold them, so it is unlikely that the Winklevoss Trust will attract many investors.

“Why would someone want a security offering all the same risks as the Bitcoin, but with an extra layer of management and fees inserted?” he said. “Even the justification that it is possible to short-sell the proposed ETP looks flimsy, given that one can already short the Bitcoin in the forward exchange market.”

The virtual currency has become progressively more popular since the financial crash, and its proponents claim it will revolutionise banking. It is created by the application of a mathematical formula and was invented four years ago by a person or group using the name Satoshi Nakamoto.

The price of Bitcoin, which is limited to 21 million in circulation, has swung between $14 and $266 this year.

Professor Rushman believes the proponents of Bitcoin should concentrate on gaining acceptance among regulators if it is to gain a permanent hold in the market.

“None of the US regulatory authorities have figured out how to regulate Bitcoin, as it breaches barriers in our understanding of what a currency is,” said Professor Rushman.

“It is certainly tainted by some speculation that it is used by the criminal underworld, but it is hard to find any evidence that criminals use it more than any other currency.

“Bitcoin needs to work harder on explaining its philosophy and on regulation, they need to do a bit of a charm offensive with the regulators and make them comfortable with it while being true to their principles.”

At the inaugural Bitcoin London conference this week, start-up Lamassu Bitcoin Ventures showed off a prototype of its bitcoin ATM, which allows users to convert bank notes into the digital currency.

The ATM was first shown off in May in the US with American dollars, but has now been setup to be used in Europe. The company hopes to ship the machines globally in the autumn, and they will cost between $4,000 and $5,000.