Bitwise launches a digital currency index

Today Bitwise launched a digital currency index via the OTCQX financial market. The index tracks the ten largest digital assets weighted by market cap, has the ticker symbol “BITW,” and can currently be traded on brokerages such as Fidelity, Charles Schwab, E*Trade, and TD Ameritrade.

“BITW is designed for financial advisors,” said Matt Hougan, Bitwise’s chief investment officer. “Financial advisors are eager for a safe and easy way to allocate to crypto for clients.”

Investing in a basket of assets via an index is typically less risky than trying to research and pick assets directly. Hunter Horsley, the co-founder and chief executive of Bitwise, says that the BITW index gives investors exposure to the digital currency markets but saves them the trouble of “ trying to pick winners or having to constantly monitor the rapid changes in the space.” 

Late to the party

The launch of Bitwise’s digital currency index comes on the heels of the S&P Dow Jones indices team (S&P DJI) announcing that they would be launching a digital asset index in 2021. Although Bitwise was able to beat the S&P DJI team to the punch, the Bitwise index comes long after GrayScale launched a product that works very similar to a digital currency index (the Grayscale Digital Large Cap Fund). Beyond that, Bitwise is a dwarf in the market with roughly $100 million assets under management compared to GrayScale who has more than $12 billion assets under management. 

Bitwise says that they are just getting around to launching a digital currency index because its clients are “just now starting to allocate to crypto in a major way.” Recently the digital currency markets have become extremely popular due to the rising prices of many coins and tokens. With that in mind, it would not be surprising to see more digital currency service providers offering digital-asset related financial products that are geared toward legacy institutions.