Ethereum Watch

Bitwise has announced the launch of a DeFi Index Fund. Institutional investors can now participate in this fund and gain exposure to many bluechip DeFi tokens.

Institutions Can Invest in DeFi via Bitwise’s New Crypto Index Fund

The new Bitwise fund consists of nine DeFi tokens, namely AAVE, SNX, UNI, MKR, YFI, COMP, UMA, LRC, and ZRX. This fund will offer accredited investors the ability to invest in DeFi tokens in a safe and secure manner.

Uniswap’s native governance token UNI has the most weight behind it, accounting for 25.14% of the entire fund. Loopring’s native token LRC brings up the rear, accounting for 3.60% of the fund.

Many factors are considered for adding new assets or rebalancing the fund. The Bitwise Crypto Index Committee oversees and makes changes to the methodology. An advisory council consisting of five DeFi experts also provides insight to the Bitwise Crypto Index Committee.

The fund is rebalanced each month with subscriptions and redemptions allowed on Tuesday and Thursday every week.

$25,000 Minimum Investment

A minimum investment of $25,000 is required from accredited investors. The expense ratio is 2.5%, which includes costs related to custody, tax, accounting, and management fees.

The fund’s custodian is Anchorage, which became the first federally chartered digital asset bank in U.S. history in January this year. In the future, shares of the fund may be allowed to be traded publicly via secondary markets.

The announcement follows the December 2020 launch of the Bitwise 10 Crypto Index Fund on U.S. OTC markets.

In February 2021, the firm started offering its Bitwise Bitcoin Fund on OTCQX, the largest OTC market in the U.S.

Disclosure: The author holds Ethereum