Coinbase announced they would be launching a cryptocurrency based index fund.
This news was somewhat lost in the shuffle of the wave of negative headlines that came out over the past few days, but it is very significant news in my opinion.
Coinbase said they will be launching this index fund due in part to large institutional type demand.
New money has been coming in but they don't really know which coins to buy.
This new index fund will take the guess work out of it and allow asset managers to have exposure to a non correlated asset class that has also been outperforming as of late.
Some specifics:
The index fund will be market cap weighted.
Meaning, the larger the market cap, the larger the influence on the index it will have, much the same way that the Dow Jones Industrial Average works.
The weighting will be as follows:
Bitcoin - 62%
Ethereum - 27%
Bitcoin Cash - 7%
Litecoin - 4%
As new coins are added the exchange, they will also be added to the Coinbase Weighted Index Fund.
Investors can start signing up for the product now, but it won't be officially launched for a few more months.
Also, the fund will only be available to accredited investors at first, but hopes to be available to all users over time.
More info about the launch can be found here:
http://www.businessinsider.com/coinbase-cryptocurrency-index-fund-2018-3
Other cryptocurrency products also on the way?
Grayscale also announced the addition of 4 new cryptocurrency based funds.
If you recall, Grayscale launched GBTC, a bitcoin investment trust a few years back. Currently it is one of the only "traditional" assets that offers exposure to bitcoin.
The 4 new funds will offer exposure to:
Ether
Ripple
Bitcoin Cash
Litecoin
However, like the other newly launched Grayscale products, these will only be available to accredited investors initially.
Over time, these products will likely also be made available to the retail public much the same way that GBTC is.
More about it can be seen here:
https://www.ccn.com/bitcoin-investment-trust-creator-launches-four-new-crypto-funds/
Stay informed my friends.
Image Sources:
https://www.ccn.com/bitcoin-investment-trust-creator-launches-four-new-crypto-funds/
