- Bitwise has proposed a new fund that would invest in publicly traded companies with at least 1,000 Bitcoin holdings.
- To qualify, companies must have a market capitalization of at least $100 million, maintain an average daily liquidity of at least $1 million, and possess a public free float of at least 10%.
Bitwise, a leading manager of cryptocurrency index funds, has submitted a proposal for a new exchange-traded fund (ETF) that will focus on publicly traded companies with substantial Bitcoin reserves. In the filing dated December 26, Bitwise detailed the requirements for companies to be included in the fund. To qualify, a company must possess a minimum market capitalization of $100 million, average daily liquidity of at least $1 million, and hold over 1000 BTC.
The proposed Bitcoin Standard Corporations ETF will assign weights to stocks primarily based on the value of a company’s Bitcoin holdings, distinguishing it from traditional ETFs that base weight on market capitalization. To promote diversification, no individual stock will account for more than 25% of the ETF’s total weight. This initiative coincides with a notable trend of public companies acquiring Bitcoin to enhance their stock valuations, particularly as the BTC has surged to a new all-time high this year.
This proposal follows Bitwise’s earlier submission of a Bitcoin-Ethereum mixed crypto ETF to U.S. regulators. In the filing with the Securities and Exchange Commission (SEC), the ETF is designed to offer balanced exposure to both Bitcoin and Ethereum (ETH), providing investors with a diversified strategy focused on the two largest cryptocurrencies.
Companies Show Growing Interest in Bitcoin
Bitcoin’s price skyrocketed by an impressive 117% this year, momentarily surpassing the $108,000 mark before stabilizing around $95,800. This rise has invigorated interest in Bitcoin-related investments, prompting financial institutions to expand their offerings.
A significant player in this trend is KULR Technology Group, which recently announced its entry into the Bitcoin space. On December 16, the company revealed that it had invested $21 million in acquiring 217.18 Bitcoin. This move paid off handsomely, as KULR’s stock price surged over 40% in a single day, achieving an all-time high of $4.80. This indicates a robust correlation between Bitcoin investments and stock market performance, particularly for companies directly involved in the cryptocurrency space.
Adding to the momentum, GraniteShares, a New York-based investment firm, filed on December 21 for a new suite of leveraged exchange-traded funds (ETFs). These funds aim to track companies that are significant to cryptocurrencies, including well-known names like Marathon Digital, Robinhood, and MicroStrategy.
In a similar vein, Strive, an investment firm founded by Vivek Ramaswamy, has put forth a proposal for an ETF focused specifically on “Bitcoin Bonds.” This innovative fund aims to invest in convertible bonds issued by companies heavily entrenched in the Bitcoin market.
As we reported earlier, Senator Cynthia Lummis introduced a draft bill that would require the U.S. Treasury to procure 1 billion Bitcoins over a five-year span. Meanwhile, Tom Lee of Fundstrat has expressed his belief that Bitcoin’s value could soar to $250,000, with the potential for even greater heights if the reserve initiative is successfully implemented. Currently, Bitcoin is trading at $95,700, reflecting a modest increase of 0.14% over the past 24 hours and 1.62% over the last week.
