Asset Manager Bitwise Files for a Top-10 Cryptocurrency ETF 🚨 This article is 6 years old...
Asset Manager Bitwise Files for a Top-10 Cryptocurrency ETF
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Updated: Oct. 5, 2018 at 12:53 pm UTC
Photo by Ana Toma on Unsplash
Institutional solutions to cryptocurrency investing are on the rise. On July 24, 2018, Bitwise filed an application for a cryptocurrency-based exchange-traded fund (ETF) with regulatory authorities in the U.S.
Bitwise HOLD 10 Cryptocurrency Index Fund
Bitwise filed an application for a top-10 cryptocurrency ETF with the U.S. Securities and Exchange Commission (SEC), according to a press release published July 24, 2018.
Founded in 2017, Bitwise Asset Management is responsible for the world’s first cryptocurrency index fund. The Bitwise HOLD 10 Private Index Fund is a market-cap-weighted index tracking the 10 largest cryptocurrencies adjusted on a monthly basis.
The Bitwise cryptocurrency ETF, entitled Bitwise HOLD 10 Cryptocurrency Index Fund, will track the same index and capture nearly 80% of the total cryptocurrency market capitalization. According to the press release, the ETF will utilize a 5-year-diluted market cap among other eligibility requirements to face liquidity, volume and custody limitations.
Lawmakers Are Slowly Legitimizing Cryptocurrency-Based Financial Products
The news follows the Cboe futures exchange application for a Bitcoin ETF, submitted to the U.S. SEC in late-June 2018.
With increasing regulatory scrutiny and the maturation of the cryptocurrency sector, lawmakers are slowly legitimizing cryptocurrency-based financial products.
Bitwise Global Head of Research Matt Hougan compared the sudden growth in cryptocurrency ETFs as resemblant of early commodity ETFs:
“Our view is that this new area has many similarities to the introduction 10 to 15 years ago of commodity ETFs. At that time, we saw the launch of single-commodity ETFs tracking gold, silver, crude oil, and other commodities, as well as ETFs tracking diversified commodity index baskets. We see a lot of similarities here.”
Adding to his statement, Hougan made clear that many ETFs will need to emerge to give investors more diversified exposure to cryptocurrencies:
“Our research shows that an index-tracking basket of multiple cryptocurrencies behaves differently than a single coin. As such, we think both sorts of exposure need to be looked at by investors when considering the growing cryptocurrency space.”
In the face of an adapting cryptocurrency market, the U.S. SEC opened up to public comment for the Bitcoin ETF and cryptocurrency ETF proposals currently under review.
Bitwise Global Head of Exchange-Traded Products, John Hyland accredited the SEC with taking an industry-forward stance to digital assets:
“… the SEC and its staff, to their credit, have asked for public comment on a wide range of issues relating to these products. We expect the staff of the SEC has had ongoing discussions with the investment firms making the crypto filings to date, and we look forward to having our own discussions with the SEC about the nature of our proposed offering.”
If approved, the Bitwise HOLD 10 Cryptocurrency Index Fund could catalyze an influx of institutional capital into the cryptocurrency sector and mark the second regulated digital asset product to list on public markets. The Bitwise ETF proposal is still under review by the SEC and is not yet available for trading on public markets.
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Posted In: Adoption, Regulation
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Bitwise
Bitwise Asset Management pioneered the first cryptocurrency index fund and is the leading provider of rules-based exposure to the cryptoasset space..