Bitwise has officially launched its new cryptocurrency exchange-traded fund (ETF) on the NYSE Arca, providing investors with an accessible and regulated product to gain exposure to leading digital assets. The ETF, trading under the ticker BITW, offers a diversified basket of cryptocurrencies, including Bitcoin, Ethereum, XRP, Solana, Cardano, Chainlink, Litecoin, Sui, Avalanche, and Polkadot. With $1.25 billion in assets under management, the Bitwise ETF stands as the largest crypto index fund globally.
Transition from Index Product to Fully-Traded ETF
Previously, Bitwise’s crypto fund operated as an index product. However, after completing its transition, it now offers a fully exchange-traded structure. This move marks a significant development for Bitwise, as it overcomes previous obstacles faced during the SEC’s review process. The launch of the ETF reflects the company’s years of effort to provide wider access to digital assets in a regulated environment.
Bitwise’s Chief Investment Officer, Matt Hougan, emphasized the growing interest among institutional investors, citing recent moves like Harvard University’s allocation to Bitcoin. According to Hougan, there has been a marked desire from investors for a regulated, index-based product, which eliminates the need for individual token selection. The BITW ETF now fills that gap by offering investors exposure to top digital assets through a single, reliable product.
Rules-Based Index and Rebalancing Strategy
One of the defining features of the Bitwise ETF is its rules-based index. The fund ranks its holdings based on market value, filtering assets according to liquidity and risk factors. The ETF is rebalanced each month to reflect changes in the crypto market. As of now, Bitcoin makes up more than 74% of the fund’s holdings, with Ethereum accounting for approximately 15%. XRP, Solana, and Cardano follow with smaller allocations.
The ETF’s rules-based system ensures that the fund adjusts its holdings automatically based on the performance and market capitalization of individual assets. This eliminates the need for subjective decisions on which assets will yield the highest returns. Bitwise has committed to maintaining transparency, with all changes to the index published monthly. Additionally, no single asset is given special treatment, reinforcing the ETF’s objective approach to portfolio management.
Bitwise’s forward-looking strategy also includes plans for other crypto-related ETFs, such as one focused on Avalanche. The firm’s ability to adapt and expand its product offerings highlights its commitment to providing institutional-grade solutions for crypto investors. The BITW ETF is a step forward in democratizing access to digital assets while maintaining transparency and robust governance.