1) You compare a fund with an insurance platform pointing out only advantages of the fund and disadvantages of the platform. For example, I assume that the fund managers will be trading at some cryptoexchanges, so why dont you add a risk that these exchanges may be compromised and the fund loses its money? Same story with the Ethereum network if the fund invests in ETH. I also would not say that there is no legal risk.
Not correct. The risks of compromised exchanges exist for the insurance platform too. Or you won't use any exchanges to purchase the crypto assets?
Or you mean the fund managers will store their funds at the exchanges? No, they won't. They will use the exchanges to buy and sell assets only, not to store them.
You also don't understand the Ethereum network risk. I mean your system is built on top of Ethereum and uses Ethereum smart contracts. If there are Ethereum network problems your system will have problems too. We all know about the hard forks.
http://forklog.net/ambisafe-urges-ethereum-to-revise-hardfork-conditions/And yes, legal risks always exist for all legal structures.