Asset manager Bitwise is streamlining three of its futures-based crypto ETFs, combining them into a single product in December, according to a filing with the U.S. Securities and Exchange Commission (SEC) on Friday. They plan to package it into a product.
The fund’s strategy, called the Bitwise Trendwise Bitcoin and Treasuries Rotation Strategy ETF, involves periodically shifting exposure between assets such as Bitcoin and Ethereum futures contracts and U.S. Treasuries. According to the company, these changes are motivated by “proprietary signals” that look at several moving averages of cryptocurrency prices.
The new funds are Bitwise Bitcoin Strategy Optimum Roll ETF (BITC), Bitwise Ethereum Strategy ETF (AETH), and Bitwise Bitcoin and Ether Equal Weight Strategy ETF (BTOP). It is a combination of.
The planned conversion follows Bitwise’s entry into the spot Bitcoin ETF space in January alongside financial giants like BlackRock and Fidelity following SEC approval. The Bitwise Bitcoin ETF currently holds approximately 39,000 Bitcoins worth $2.3 billion, according to CoinGlass data.
The fund takes a momentum-based approach to investing in Bitcoin and Ethereum futures. The fund gains exposure to cryptocurrencies when Bitwise signals indicate “price momentum is gaining momentum,” while taking refuge in government debt if the opposite trend emerges.
“Momentum is a well-established factor in almost every asset class, and it’s just as powerful in crypto,” Bitwise CIO Matt Hogan said in a press release, adding that the new fund’s goal is to “minimize downside volatility.” risk-adjusted returns.” ”
Since launching the Spot Ethereum ETF in July, Bitwise has continued to position itself as a provider of funds that offer investors access to cryptocurrencies through traditional brokerage accounts. Earlier this week, Bitwise filed for the industry’s first spot XRP ETF in the US.
The first futures-based crypto ETF was approved three years ago, with regulators giving the green light to ProShares’ Bitcoin Trust. However, since the launch of spot-based alternatives, several asset managers have rebalanced their futures-based products.
For example, VanEck announced last month that it would liquidate its Ethereum futures investment product. The company cited investor interest and liquidity as factors in determining the move.
Bitwise’s new fund will charge investors a fee rate of 0.85%, and the prospectus makes clear that it will not invest directly in digital assets. Because the fund can rotate its exposure completely into U.S. Treasuries, Bitwise said, “there may be periods, perhaps long periods, in which the fund has no exposure to Bitcoin futures contracts.”
Bitwise cited the “limited track record” of the three funds as a potential risk, but Bitwise President Teddy Fusaro said in a statement that the company is breaking new ground with this product. He said that
“At Bitwise, we believe there are many different ways investors may want to access this new and emerging asset class,” he said. “We are pleased to introduce new innovative strategies to these three ETFs to provide investors with more choices in market access.”
Edited by Andrew Hayward
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