Bitwise files for ETF tracking companies holding over 1000 Bitcoin in treasury

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As a seasoned researcher with years of experience in both traditional finance and the ever-evolving world of cryptocurrencies, I find this development by Bitwise particularly intriguing. The Bitcoin Standard Corporations ETF is a unique proposition that seems to bridge the gap between Wall Street and the crypto realm, offering institutional investors a regulated and familiar way to invest in companies with substantial Bitcoin holdings.

Bitwise is suggesting a fresh investment option – an exchange-traded fund – that primarily invests in public companies known to have more than 1000 Bitcoin stored within their company assets.

According to a December 26th regulatory filing, Bitwise stated that the Bitcoin Standard Corporate ETF will purchase shares from companies that have embraced the “Bitcoin Standard” by keeping a minimum of 1,000 Bitcoins (BTC) in their corporate assets.

The mentioned securities encompass various types such as common shares, depositary receipts (both American Depositary Receipts – ADRs and Global Depositary Receipts – GDRs), tracking stocks, and other equity units. These securities can be issued by both U.S. and foreign companies, including those based in developing nations, as indicated in the filing.

In order to be considered, corporations should meet three key requirements:

As a researcher examining the structure of this particular ETF, I’d like to highlight that it differs from traditional equity ETFs in terms of weighting. Instead of considering the overall market capitalization when determining the proportion of each company’s holdings, this ETF places more emphasis on the market value of each company’s Bitcoin holdings.

As a crypto investor, I’ve noticed that even though Tesla, with its massive $1.42 trillion market cap, only holds 9,720 BTC in its reserves, it will have a lower weighting in the ETF compared to Marathon Digital Holdings, which boasts over 44,000 BTC in its reserves, despite its much smaller market cap of $6.55 billion. This means that Marathon’s influence in the ETF is disproportionately larger than Tesla’s, given their respective Bitcoin holdings.

In this investment fund, we’ll make sure that no one stock accounts for more than 25% to maintain diversity and avoid excessive exposure to a single company.

As an analyst, I’m expressing my thoughts on the filing: The ETF seems to attract a multitude of contenders eager to secure a place within its index, according to Nate Geraci, President of the ETF Store.

This year’s strong performance of Bitcoin has triggered the appearance of a flood of investment products aimed at Wall Street, providing a means for institutional investors to gain access to Bitcoin and other digital currencies via regulated and well-known financial instruments, as they express an increasing interest in this asset class.

In simple terms, Bitwise has presented a plan for a combined Bitcoin-Ethereum exchange-traded fund (ETF) to American regulatory bodies. As stated in their filing with the Securities and Exchange Commission on November 26, this ETF is designed to offer equal exposure to both Bitcoin and Ethereum, thereby providing investors with a well-rounded investment strategy for the two largest cryptocurrencies based on market capitalization.

On December 21st, GraniteShares, based in New York, submitted an application to create a group of ETFs that use leverage to follow the performance of notable companies holding substantial cryptocurrency assets. Among these companies are Riot Platforms, Marathon Digital, MicroStrategy, and Robinhood.

Recently this month, Grayscale Investments applied for the transformation of its Solana Trust (GSOL) into a stock market traded fund.

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2024-12-27 10:21