Hashdex debuts US spot Bitcoin ETF ‘DEFI’ with impressive pre-market activity Hashdex debuts US spot Bitcoin ETF ‘DEFI’ with impressive pre-market activity
Hashdex's DEFI Bitcoin fund could compete against rivals if its fees are competitive, analysts suggest.
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Updated: Mar. 27, 2024 at 1:46 pm UTC
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Asset management firm Hashdex’s spot Bitcoin exchange-traded fund (ETF) will begin trading today on the US market under the ticker “DEFI.”
According to Yahoo Finance data, early trading data indicates significant trader interest, with the fund already showing a pre-market uptick of over 3%.
Fund conversion
In a March 26 statement, Tidal Investments and Hashdex announced renaming Hashdex Bitcoin Futures ETF as Hashdex Bitcoin ETF under the ticker “DEFI.”
DEFI’s new benchmark will be the Nasdaq Bitcoin Reference Price Settlement (NQBTCS), aligning more closely with its direct Bitcoin investment strategy. Hashdex emphasized its transparent approach to trading Bitcoin, utilizing the CME futures exchange for physical transactions and CME-monitored pricing.
The fund would hold at least 95% of assets in physical Bitcoin, with the remaining 5% potentially allocated to CME-traded Bitcoin futures contracts and cash.
Hashdex stated that BitGo would act as its Bitcoin custodian, with Tidal serving as the ETF sponsor and administrator, which is consistent with its role as a partner.
Hashdex CEO Marcelo Sampaio said:
“We are thrilled to complete the conversion of DEFI, and with it deliver an innovative product in coordination with Tidal that furthers our mission of empowering individuals and institutions around the world to access this revolutionary innovation.”
How will DEFI compete?
DEFI’s launch comes nearly three months after the successful introduction of various Bitcoin ETF products in the US. Led by BlackRock’s IBIT, these ETFs have seen impressive net inflows exceeding $12 billion.
Eric Balchunas, Bloomberg’s senior ETF analyst, noted that DEFI could potentially compete if its fees undercut those of its competitors significantly. He said:
“Spot Bitcoin ETF #11. The getting is so good right now I could see this one getting some bites (if the fee is competitive) despite being so late.”
However, the fund’s prospectus indicates that its fee may hover around 0.90%, slightly higher than the industry average.
Nate Geraci, ETFStore president, opined that he expected Hashdex DEFI ETF to be one of the earliest pioneers in the market. Nevertheless, he predicted the fund would garner significant interest from crypto-native firms.
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In this article
Bitcoin, a decentralized currency that defies the sway of central banks or administrators, transacts electronically, circumventing intermediaries via a peer-to-peer network.
BitGo
BitGo is a market leader in institutional-grade cryptocurrency investment services, providing institutional investors with security, compliance, and custodial solutions for blockchain-based currencies.
BlackRock
BlackRock, synonymous with global asset management, is an American multinational investment management corporation based in New York City.
The BlackRock Bitcoin ETF, known as the iShares Bitcoin Trust (IBIT), is an investment fund that provides regulated exposure to Bitcoin for investors.
The Hashdex Bitcoin ETF, also known as the Hashdex Nasdaq Bitcoin ETF, is a fully physically backed Exchange Traded Fund (ETF) that provides investors with a simple, secure, and cost-efficient way to gain exposure to the Nasdaq Bitcoin Reference Price™.
Eric Balchunas is an American author, ETF analyst, and Senior ETF Analyst at Bloomberg Intelligence.