Bitwise's new ETF prioritizes companies with at least 1,000 BTC in their treasuries.
Marathon Digital holds over 44,000 BTC, exceeding Tesla's 9,720 BTC.
The ETF caps any single stock's weighting at a maximum of 25%.
Bitwise Asset Management has submitted a proposal to the U.S. Securities and Exchange Commission to list a Bitcoin Standard Corporations ETF. This unique exchange-traded product targets firms with at least 1,000 BTC in their corporate treasuries.
The ETF will consist of equity securities and securities similar to such securities, including common stock, depositary receipts, tracking stocks, and other equity-type securities of qualifying companies. To qualify, firms must have a market capitalization greater than $100m, a daily traded volume above $1m, and a public float of less than 10%. This helps obtain the target list of good financial companies while satisfying regulatory requirements.
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The fund will not have the conventional ETF weighting by market capitalization but by each company's market value in Bitcoins. Some firms, such as Marathon Digital Holdings, with over 44,000 BTC, will have higher weightings than Tesla, which owns 9,720 BTC despite the firm's higher market capitalization. To reduce the risks inherent in investing in individual stocks, the ETF keeps the weights of the constituent stocks below 25%.
Rising Interest in Bitcoin-Focused ETFs
The Bitcoin Standard ETF is part of a growing trend of institutional Bitcoin investment products seeking to offer compliant access to the asset class. These products capitalize on higher institutional demand for cryptocurrencies, buoyed by Bitcoin's performance.
Other recent filings show similar tendencies. For instance, Bitwise offered a mixed Bitcoin - Ethereum ETF to provide diversified exposure to the two biggest cryptos by market value. At the same time, GraniteShares applied for the creation of leveraged ETFs focused on businesses tied to crypto, and Grayscale keeps turning its crypto trusts into ETFs to improve market accessibility.
Spot Bitcoin ETFs See Renewed Inflows
The Bitcoin ETF market has recently seen high inflows after major outflows. According to the data, Spot Bitcoin ETFs witnessed $475.2 million in net inflows on December 26, canceling the prior four days of losses. Fidelity’s Wise Origin Bitcoin Fund was the most significant, starting a recovery of $254.4 million, followed by the ARK 21Shares Bitcoin ETF with $186.9 million.
These trends indicate renewed interest in equities linked to Bitcoin. This is attributed to the fact that they are new, diversified, and easily accessible financial products. Another notable proposed offering comes from Bitwise in the form of the Bitcoin Standard Corporations ETF, which only focuses on companies that use Bitcoin as a reserve currency. This approach is consistent with increasing concern from corporations about incorporating digital assets into their financial management.
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