TLDR
- Bitwise has filed a prospectus for an ETF focused on stablecoins and asset tokenization.
- The ETF aims to track the Bitwise Stablecoin and Tokenization Index.
- The fund targets companies benefiting from stablecoin adoption and tokenization growth.
- The equity sleeve of the ETF allocates up to 50% to five key categories of companies.
- Companies face tiered restrictions based on their level of exposure to stablecoins.
Bitwise has filed a prospectus for a new stablecoin and tokenization exchange-traded fund (ETF). The fund aims to track the Bitwise Stablecoin and Tokenization Index, targeting companies and assets benefitting from stablecoin growth and asset tokenization. The ETF is expected to launch around Thanksgiving, with a 40 Act structure for faster regulatory approval.
Bitwise ETF Allocates 50% to Key Sectors
The Bitwise ETF’s equity sleeve allocates up to 50% of its capital to companies in five categories. These categories include stablecoin issuers, infrastructure providers, payment processors, tokenization exchanges, and stablecoin-oriented retailers. Bitwise will apply tiered restrictions based on the level of a company’s exposure to stablecoins.
Tier 1 companies, with substantial stablecoin exposure, will face 15% caps. Tier 2 companies, with moderate exposure, will have 8% limits. Tier 3 companies, with limited involvement, will be restricted to 3% of the fund’s total allocation. Bitwise plans to select 20 companies from the top two tiers, with the possibility of adding up to 10 Tier 3 firms if necessary.
Crypto Asset Sleeve and Oracle Tokens
The ETF will also include a crypto asset sleeve, investing in blockchain infrastructure exchange-traded products. The assets in this sleeve must have at least 1% market share in stablecoins or tokenization. Additionally, 5% of the fund will be allocated to oracle tokens, which connect blockchains to external systems.
The ETF will allow a maximum of 22.5% exposure to the largest constituent in the index. The fund will rebalance its holdings quarterly, focusing primarily on information technology companies. The stablecoin and tokenization ETF reflects the growing institutional interest in tokenizing real-world assets and stablecoins. Bitwise’s proposal comes as stablecoins recently reached a $287 billion supply.
