Bitwise Asset Management, a crypto-centric investment group, has recently released two funds that solely focus on Bitcoin (BTC) and Ethereum (ETH). The move offers affluent crypto investors the opportunity to capitalize on the current bear market, which has seen cryptocurrency prices collapse by upwards of 80% in most cases.
The development was circulated in a press release published via PRNewswire on December 5th, 2018.
It is a bold move by the firm that introduced the world’s first digital currency index fund. Rather than mulling over the recent crypto crash, Bitwise joins a series of other blockchain-centric startups by pushing forward new products and ideas. Recently, Nasdaq announced its plans to launch Bitcoin futures in 2019, while InVault expanded its crypto custody services into Hong Kong from China.
The funds will be the latest additions to the broad-market Bitwise 10 Private Index Fund, while also bringing further diversity to the American startup’s already expansive crypto offerings. Bitwise’s current offerings are as follows: Bitwise 10 Index Offshore Fund, Bitwise 10 Large-Cap Crypto Index, Bitwise 20 Mid Cap Crypto Index, Bitwise 70 Small-Cap Crypto Index, and its Bitwise 100 Total Market Crypto Index.
High Premiums and Lock-In Clauses Have Been Excluded From The Bitwise Beta Funds
The funds, currently in beta, offer a liquid and low-cost vehicle for investors. This idea will allow investors to have a better chance are garnering a positive return on their investments in BTC and ETH, which are trading at 81% and 92% lower than their all-time high valuations respectively.
According to the release, investors will be given plenty of freedom, coupled with the ability to enter and exit the fund weekly without fears of lock-up periods.
There will be no exit or performance-based fees, and investors will not incur any additional premiums. Bitwise also stated that there will be no extra expenses incurred by subscribers outside of the specified management fee. Adding to a list of attractive features is the inclusion of a K-1 tax document service, which will be provided to all clientele yearly.
Furthermore, all BTC and ETH acquired by members of the funds will be placed in cold storage wallets, purportedly managed by an undisclosed third-party custodian.
Launch Of Funds Was Driven By Popular Demand
With the current market climate, there has been a growing number of disgruntled investors. It is bad enough losses in BTC and Ether values has hit many investor and traders hard. Include the additional fees, taxes, and extra charges other services impose, it becomes apparent that it has been extremely difficult to turn a profit. Bitwise, a forward-thinking firm in an already innovative realm, clearly heard the calls for a more affordable and trader/investor friendly instruments.
Bitwise CEO, Hunter Horsley, said in a company statement:
“Though an ETF has not yet been approved, investors and advisors like the fund format because it’s professionally managed and simplifies access to best-in-class custody, trading, reporting, and tax preparation, and allows for the safe capture of events like hard forks and airdrops”
BitWise Has Released Two Shared Classes
Both share classes are available to U.S. accredited investors. The first of which is the Institutional Shares option. This will require a minimum investment of $1 million and comes with an all-in expense ratio of 1%. The other class offered is the Investor Shares deal. The all-in expense ratio is slightly higher at 1.5%, but the minimum investment required is considerably lower, a relatively mere $25,000.
There aren’t many similar offerings that match the startup’s latest funds, but as with any industry, there will almost certainly be some reaction from its competitors. This may well be the beginning of a more investor-friendly market for traders and markets.