In a document submitted to the U.S. Securities and Exchange Commission (SEC) on June 18, Hashdex proposed creating a spot exchange-traded fund (ETF) combining Bitcoin (BTC) and Ethereum (ETH) on the Nasdaq exchange. I did.
The proposed ETF will balance cryptocurrency assets according to their market capitalization, with Bitcoin (BTC) accounting for 70.54% and Ether (ETH) accounting for 29.46% as of May 27. The passive investment strategy tracks the daily market movements of the Nasdaq cryptocurrency US settlement price. Index it without trying to “beat” it.
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Analyst James Seyffart said combined asset ETFs “make a lot of sense.” The ETF does not invest in any other physical assets other than BTC and ETH. However, he added:
“If other crypto assets are included (other than Bitcoin or Ethereum) or are eligible for inclusion as index components (…), the Sponsor will switch the Trust’s investment strategy to use only Bitcoin and Ethereum (. ..). It is the same ratio as determined by the index.”
Cryptocurrency assets could be included subject to a set of rules, including “currently listed on a U.S.-regulated digital asset trading platform or serving as the underlying asset for a derivative instrument listed on a U.S.-regulated derivatives platform,” the filing said.
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Both Coinbase and BitGo act as custodians for BTC and ETH assets. They will offer segregated accounts to individual shareholders.
Hashdex revolutionizes ETF structures
Brazil-based investment manager Hashdex applied to the SEC to create an ETH ETF, but later withdrew its application. The indexed crypto ETF traded in Brazil includes nine coins, with BTC and ETH accounting for nearly 92% of the value. The US-traded spot BTC ETF includes up to 5% of BTC futures contracts and acquires spot assets from CME.
Hashdex must file and receive SEC approval for its S-1 application. The agency must respond to 19-b4 within 90 days, during which time it must accept comments from the public and other financial institutions on the proposal. The SEC’s final decision on the fund should be made no later than March 2025, according to Seyffart.
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