Bitwise Asset Management is preparing to overhaul three of its cryptocurrency futures ETFs by including U.S. Treasury bonds in an effort to more effectively manage volatility.
Bitwise Makes Changes to Crypto Futures ETFs After XRP ETF Application
The firm announced its plans in a filing with the U.S. Securities and Exchange Commission (SEC) today, outlining significant changes to its investment strategy.
Bitwise Bitcoin Strategy Optimum Roll ETF will be renamed Bitwise Trendwise Bitcoin and Treasuries Rotation Strategy ETF, reflecting a change in focus. Similarly, Bitwise Ethereum Strategy ETF and Bitwise Bitcoin and Ether Equal Weight Strategy ETF will also be revamped to include Treasury bonds. The transitions are expected to be completed by December 3, 2024, according to Bitwise.
“The new Trendwise strategies leverage momentum through a trend-following approach that alternates between exposure to crypto and Treasurys depending on market direction,” said Matt Hougan, Bitwise’s Chief Investment Officer. “The goal is to help minimize downside volatility while potentially improving risk-adjusted returns.”
This arrangement is designed to reduce the often high volatility associated with crypto assets by incorporating the stability of U.S. Treasury bonds into the portfolio mix.
Bitwise has made significant strides in the crypto investment world throughout 2024. The firm launched its spot Bitcoin ETF in January, followed by the approval of its spot Ethereum ETF. Both products marked significant milestones in the crypto ETF space, receiving approval from the SEC after a lengthy regulatory review.
Earlier this week, Bitwise took another bold step by filing a registration statement with the SEC for a spot XRP ETF. If approved, it would be the first spot ETF for XRP, a digital asset tied to Ripple. However, the approval process could face hurdles as the SEC is currently in a legal dispute with Ripple. The agency claims that Ripple raised $1.3 billion through the sale of XRP, which the SEC considers an unregistered security.
*This is not investment advice.