Recently, Strive, an asset management company co-founded by cryptocurrency asset management firm Bitwise and Vivek Ramaswamy, head of the Department of Government Efficiency (D.O.G.E), submitted an application to U.S. regulators to launch an ETF focused on 'Bitcoin-related bonds.' The fund will invest in convertible bonds issued by MicroStrategy and other companies that plan to allocate most of their funds to purchasing Bitcoin.
Bitcoin Bond ETF: A New Investment Tool
According to the application documents, Strive's Bitcoin Bond ETF will be actively managed by a professional team and will gain exposure to Bitcoin bonds through direct investments or the use of financial derivatives such as swap contracts and options. The fund aims to provide investors with an indirect opportunity to participate in the growth of the Bitcoin market while mitigating the risks associated with directly holding cryptocurrencies.
MicroStrategy has spent approximately $27 billion on Bitcoin since 2020, becoming a significant driver of cryptocurrency adoption in the corporate world. The company primarily raises funds by issuing convertible bonds and new shares, which can be converted into MicroStrategy stock (MSTR) under certain conditions. Since adopting this strategy, MicroStrategy's stock price has soared over 2200%.
Corporate Bitcoin Holding Wave
In addition to MicroStrategy, other companies have also begun to adopt similar strategies, incorporating Bitcoin into their financial reserves. To date, corporate financial reserves hold approximately $56 billion in Bitcoin, demonstrating the increasing importance of Bitcoin as a corporate asset.
The cryptocurrency ETF market has a bright outlook
With the regulatory environment becoming more favorable, the cryptocurrency ETF market is experiencing a new wave of growth. In 2024, several asset management companies have submitted applications to launch ETFs covering mainstream altcoins such as Solana (SOL), XRP (XRP), and Litecoin (LTC).
Industry analysts predict that if Strive's Bitcoin Bond ETF is approved, it will provide traditional investors with more diverse Bitcoin investment channels, offer liquidity to companies holding Bitcoin reserves that issue convertible bonds, and further promote the popularization of Bitcoin and related financial products.
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