Bitwise Files for ETF Tracking Corporate Bitcoin Giants
Bitwise has filed to form an exchange-traded fund (ETF) that would focus on companies holding large amounts of Bitcoin. This idea? Offering investors a way to gain exposure to companies adopting the “Bitcoin Standard.” Curious what this means? Let’s break it down.
A closer look at Bitwise’s plans
The proposed fund is called Bitwise Bitcoin Standard Company ETFnot an ordinary ETF. To qualify for inclusion, companies must hold at least 1,000 Bitcoins in their reserves. That’s not all. They also need a market capitalization of at least $100 million, daily liquidity of $1 million and less than 10% of the stock being privately held.
Here’s the interesting part: ETFs don’t weight companies based on their market size, as most funds do. Instead, it focuses on the value of their Bitcoin holdings. With a whopping 444,262 BTC, MicroStrategy will dominate the ETF, although Tesla owns far less Bitcoin (9,720 BTC) and has a much larger market cap. However, to maintain balance, each holding is capped at 25%.
Bitcoin’s appeal to businesses continues to grow
Why are companies getting involved in Bitcoin? Part of the reason is that it’s great for their stock prices. take Cool Technology GroupFor example. They purchased 217.18 BTC for $21 million earlier this month. This decision paid off hugely, sending their stock price up 40%.
Let’s not forget about Bitcoin itself. The cryptocurrency has soared 117% this year, hitting an all-time high of $108,000 in December. Even now, it’s steady at around $95,800. Clearly, Bitcoin’s appeal is only growing.
what to expect
Bitwise’s ETF isn’t the only one vying for attention. Strive, a company founded by Vivek Ramaswamy, has applied to set up an ETF focused on Bitcoin bonds. It will be interesting to see how these competing proposals play out.
For investors looking to bet on rising Bitcoin adoption, these ETFs could open exciting new doors. But as with cryptocurrencies, potential and uncertainty are intertwined.
