WisdomTree launches three more crypto ETFs
WisdomTree is deepening its push into crypto, with the launch of three more crypto ETFs that invest in coin baskets.
BLOC invests in the seven largest cryptos on a market weighted basis. They are: Bitcoin, Ethereum, Solana, Cardano, Polkadot, Litecoin, Bitcoin Cash. Each coin is capped at taking 45% of the fund’s weight. This stops Bitcoin and Ethereum becoming too influential. It charges 1.45%.
MEGA is extremely simple. It just invests 50/50 in Bitcoin and Ethereum. It returns the two to equal weight every quarterly rebalance. It charges 0.95%, in line with WisdomTree’s pure Bitcoin and Ethereum ETFs.
WALT is the same as BLOC only it removes Bitcoin and Ethereum from the mix and leaves the other five. Individual coins are capped at 50%, stopping Solana and Cardano taking too much weight. It charges 1.45%.
Bernie’s commentary – why not single altcoin ETFs?
WisdomTree’s movements into the crypto market in Europe have been modestly successful. The firm has about $400M across its Bitcoin and Ethereum ETFs. This makes it fifth largest of Europe’s crypto ETF issuers, behind CoinShares, 21Shares, VanEck, and ETC Group.
That WisdomTree would want to continue expanding here only make sense. However it raises the obvious question about which products they should build. Should they build single coin ETFs? Or should they create basket products like these? They’re running into competition either way. It’s hard to know what the right choice is.
That they’ve gone for baskets suggests to me at least that they may have concerns about cryptos with smaller market caps. Given the well-known presence of insiders and whales in these smaller coins I can hardly blame them. The basket approach may also suggest that they have the wealth market in mind. (Private banks maybe?)
For my part my favourite of them is WALT. It’s a good ticker too.