The cryptocurrency market is constantly evolving, and the recent news of two new Exchange Traded Funds (ETFs) focused on companies holding Bitcoin in their corporate treasuries demonstrates the increasing acceptance of cryptocurrency by large corporations. This trend provides new opportunities for investors who wish to indirectly invest in Bitcoin through public companies.
In a context where Bitcoin’s volatility always sparks debates, investing in companies with BTC reserves emerges as an interesting alternative. Instead of purchasing the cryptocurrency directly, investors can acquire shares in companies that hold Bitcoin on their balance sheets.
Bitwise, an asset manager well-known for its cryptocurrency ETFs, has proposed the Bitwise Bitcoin Standard Corporations ETF. This fund would invest in companies that have embraced what they call the “Bitcoin Standard,” which refers to companies holding more than 1,000 BTC and meeting specific size and liquidity criteria. These criteria include a market capitalization of over $100 million and average daily liquidity of over $1 million.
One notable difference is that the weighting of the stocks in this ETF would not be determined based on the companies’ market capitalization, as is common in traditional ETFs. Instead, it would be based on the value of their Bitcoin holdings. Consequently, a smaller company with a significant amount of Bitcoin in its treasury could have a higher weighting in the ETF than a larger company with a smaller BTC holding.
Another intriguing proposal comes from Strive, an asset manager co-founded by Vivek Ramaswamy. The Strive Bitcoin Bond ETF aims to provide exposure to convertible bonds issued by MicroStrategy and other companies that allocate a substantial portion of their profits to purchasing Bitcoin. Unlike Bitwise’s offering, this ETF is classified as “non-diversified,” allowing for a greater concentration of assets from a single issuer.
MicroStrategy, known for its substantial Bitcoin holdings, is explicitly mentioned in the fund’s prospectus, which seeks to gain exposure to convertible securities issued by MicroStrategy Incorporated or other companies that Strive expects to invest all or a significant portion of their proceeds in purchasing Bitcoin (collectively referred to as “Bitcoin Bonds”).
The launch of these new ETFs could represent a significant milestone in Bitcoin adoption. At the time of publication, the price of BTC was quoted at US$96,423.60, reflecting a 1.1% increase in the last 24 hours.
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Bitcoin
ETF