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The launch of two new low-cost beta liquid funds holding Bitcoin and Ethereum exclusively was announced by Bitwise Asset Management, a cryptocurrency asset manager involved in the development of funds, indexes, insight, and other services. This firm provides professional services to individuals, financial advisors, family offices, investment managers, and institutions in navigating cryptocurrency.
These new funds (The Bitwise Bitcoin Fund and the Bitwise Ethereum Fund) are the second and third strategies in the Bitwise fund family, joining the broad-market Bitwise 10 Private Index Fund. The aim of these funds is to capture the total returns available to investors in Bitcoin and Ethereum. Also, the funds are strictly available to US-accredited investors.
Bitwise reported that the funds are currently available in two share classes – Institutional Shares and Investor Shares. The Institutional Shares have an all-in expense ratio of 1.0% and a minimum investment of $1 million, while Investor Shares have an all-in expense ratio of 1.5% and a minimum investment of $25,000. These new funds will safeguard holdings in 100% cold storage with an institutional third-party custodian and prepare simple K-1 tax documents for investors each year.
Industry enthusiasts would want to know the reason for the creation of these funds as Bitwise Asset Management has other funds that could serve this purpose. Consequently, Bitwise released a statement through Matt Hougan, its global head of research saying:
With significant positive developments on the horizon, including the launch of the Bakkt bitcoin futures exchange from ICE, the launch of Fidelity Digital Assets, and the continued movement of institutional investors like Yale University and Stanford University into the crypto space, we have seen significant inbound demand for high-quality bitcoin and ether funds.
He further added that clients of Bitwise Asset Management have been adding to their positions throughout the downturn and many who have been following the space for a while are using this opportunity to finally come in.
The CEO of Bitwise Asset Management, Hunter Horsley, then said that the 68% drawdown in Bitcoin prices this year has given investors a unique opportunity to enter the market at prices many thought we would never see again.
He further stressed that though an ETF has not yet been approved, investors and advisors like the fund format because it is professionally managed and simplifies access to best-in-class custody, trading, reporting, and tax preparation. It also allows for the safe capture of events like hard forks and airdrops. Consequently, both funds were declared open by Bitwise Asset Management, and clients were urged to subscribe.