Bitwise has filed with the United States Securities and Exchange Commission to launch 11 new exchange-traded funds that would track a range of individual altcoins while also investing in related financial products.
Per the Dec. 31 filing, Bitwise’s new “strategy” funds would give investors exposure to a wide array of tokens such as Aave, Starknet’s STRK, Uniswap’s UNI, Zcash, Bittensor’s TAO, Canton Network’s CC, Ethena’s ENA, Hyperliquid’s HYPE, NEAR Protocol’s NEAR, Sui’s SUI, and Tron’s TRX, bringing them into regulated investment channels for the first time, as most of these remain primarily available through crypto exchanges.
Bitcoin eyes a different investment product
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With the success of Bitwise’s other single-token offerings like the Bitwise Solana Staking ETF and the Bitwise XRP ETF, the fund manager plans to go deeper into the altcoin segment with its new slate of products.
“The Fund seeks to achieve its investment objective through direct and indirect investments,” Bitwise said in the filing, referring to the core mechanism through which the ETF will provide exposure to its respective asset.
However, unlike other crypto ETFs that are generally backed entirely by the underlying asset, Bitwise’s strategy ETFs would invest up to 60% of their portfolios directly in the token and the remaining 40% in securities issued by one or more exchange-traded products that invest directly in or provide exposure to the token.
“The Fund may also invest in derivatives contracts, such as futures contracts and swap agreements,” the filing noted, adding that under normal market conditions, the fund will invest at least 80% of its net assets plus borrowings in the token itself, exchange-traded products tied to it, or related derivatives.
Simply put, the funds would use a hybrid structure to combine spot holdings, ETPs, and derivatives to achieve targeted exposure to specific crypto assets.
With this, Bitwise adds a slightly different type of product to its existing ETF suite by targeting a narrower type of risk.
Unlike broad index strategies, these new funds concentrate exclusively on a single coin, offering investors a more focused bet on individual narratives. Bitwise is creating a menu of highly specialized, high-risk, and high-reward ETFs.
An investor could pick two or three of these funds to build their own custom, thematic crypto portfolio without having to directly buy and secure the underlying tokens themselves.
It provides targeted access to specific parts of the crypto market that were previously difficult for mainstream investors to access through regulated products.
A flurry of altcoin ETFs surface
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Over the past several months, Bitwise has filed for and launched a number of crypto ETF products that have joined its spot US lineup, comprising the Bitwise Bitcoin ETF, the Bitwise Ethereum ETF, the Bitwise Solana Staking ETF, and the Bitwise XRP ETF.
Similarly, other ETF issuers like Grayscale, VanEck, and 21Shares, among others, have also begun exploring the single-altcoin ETF space.
For instance, Grayscale recently filed to convert its Bittensor trust into a spot ETF.
Meanwhile, VanEck and 21Shares have filed to launch spot or thematic ETFs for altcoins such as Dogecoin and Avalanche.
