While the entire crypto verse awaits the decision of the United States Securities and Exchange Commission (SEC) concerning previous bitcoin ETF applications by other firms, San Francisco-based asset management company, Bitwise has filed for a cryptocurrency index exchange-traded fund.
The fund is aimed at enabling the digital assets investment startup to handle bitcoin and nine other altcoin investments for clients, as stated in its press release on July 24, 2018.
Bitwise HOLD 10 ETF
Bitwise asset management firm is seeking an SEC approval for its new ETF called the Bitwise HOLD 10 Cryptocurrency Index Fund.
The firm, which had previously launched a crypto index fund that tracks the performance of the top ten digital currencies – the Bitwise HOLD 10 Private Index Fund, is now primed to create a crypto ETF aimed at monitoring the returns of its HOLD 10 Index.
According to Bitwise, its HOLD 10 Index is a “market-cap weighted index of the [ten] largest cryptocurrencies, rebalanced monthly,” capturing about 80 percent of the total market capitalization of the cryptocurrency market.
Importantly, Bitwise claims its HOLD 10 Index uses a “5-year-diluted market cap” as well as other “eligibility criteria” to mitigate the issues of liquidity, concentration, supply, custody limitations and other challenges plaguing the cryptosphere.
A Unique ETF Proposition
Interestingly, unlike the VanEck SolidX Bitcoin Trust and other ETFs that focuses primarily on a single cryptocurrency offering, the Bitwise HOLD 10 Cryptocurrency Index Fund will help clients hold ten significant cryptos including bitcoin, ethereum, XRP and more.
Global Head of Research at Bitwise, Matt Hougan, stated:
“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.”
Established in 2017, Bitwise Asset Management company has strong backing from credible institutional investors and individuals, including Blockchain Capital, Alison Davis, and several others.
SEC Review, Mixed Reactions
While the US regulators are currently reviewing the VanEck and SolidX ETF proposal and may come up with a favorable decision shortly, the SEC has however announced its intention to postpone passing a verdict as regards the ETF filing of Direxion Investments till September 2018.
As stated in the Federal Register, this decision will enable the SEC to have ample time to access the firm’s filing extensively since it had earlier disapproved Direxion’s ETF application.
With authorities getting set to pass the ultimate ETF judgment shortly, it’s worth noting that some observers in the cryptocurrency space remain unsupportive of the impending cryptocurrency ETFs.