NYSE Arca has filed an application with the SEC to list Bitwise’s cryptocurrency ETP, which includes 10 leading digital assets, with Bitcoin making up 75.1% of the portfolio.

On November 15, NYSE Arca officially filed Form 19b-4 with the US Securities and Exchange Commission (SEC), proposing to list Bitwise 10 Crypto Index Fund (BITW) as an exchange-traded product (ETP). The move marks an important step in Bitwise's efforts to convert its current $1.3 billion trust fund into an ETP structure, which promises to bring many benefits to investors.

Bitwise's BITW Fund is allocated to the top 10 cryptocurrencies by market capitalization, including Bitcoin, Ether, Solana, XRP, Cardano, Avalanche, Bitcoin Cash, Chainlink, Uniswap, and Polkadot. As of October 31, 2024, Bitcoin is the largest holding in the portfolio at 75.1%, followed by Ether (16.5%), Solana (4.3%), and XRP (1.6%). The remaining assets all account for less than 1% of the fund's total value.

Advantages of ETPs over existing trusts

According to Hunter Horsley, CEO of Bitwise, ETPs are the most efficient, convenient, and useful means of providing access to cryptocurrencies. Bitwise believes that the transition to ETPs will bring many benefits, including regulatory protection and increased efficiency for shareholders.

Specifically, ETPs allow for continuous subscription and redemption, creating an arbitrage mechanism that helps the secondary market trading price more closely match the fund's net asset value (NAV). This helps minimize arbitrage risk, a common problem with cryptocurrency trusts.

Bitwise's move comes as NYSE Arca also filed to list Grayscale's Digital Large Cap Fund as an ETF on October 29. The fund also invests in a basket of spot cryptocurrencies, including BTC, ETH, SOL, XRP, and AVAX.

Source: Eric Balchunas

Bloomberg analyst Eric Balchunas said that the filing of applications by major institutions such as Bitwise and Grayscale to list crypto investment products could be related to the political context, especially the re-election of Donald Trump as president. However, he also noted that the success of these applications is still uncertain and requires more information to assess.