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There will soon be a lot more avenues to get crypto exposure.
Like, a lot.
That’s good for choice, sure — even if those options will be consolidated down the line once we get a better sense of where the space is headed. I wrote earlier this week about the demand for crypto equities (and how some are evaluating those) as more such stocks (like Circle and Bullish) hit major exchanges.
This IPO chapter is set to collide with regulatory clarity around more crypto ETFs, setting up an all-around boom in how people can access the segment within their brokerage accounts.
I imagine not all these ETFs (i.e. those looking to hold SOL, XRP, DOGE and even TRUMP) will see a whole lot of demand, particularly not right away. So for fund issuers, these next months and years will be about experimentation.
21Shares filed for three more ETFs yesterday. One would offer broad crypto exposure via tokens themselves, ETFs, derivatives and equities. Two others offer leveraged exposure to dogecoin and SUI via derivatives.
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“With both active and leveraged ETFs, we’re moving past replication into the next chapter of crypto investing — research-driven, forward-looking and built to give investors new ways to capture long-term growth across the digital asset ecosystem,” 21Shares’ Federico Brokate said in a statement.
Brokate previously worked at BlackRock as an iShares business strategy director — helping the world’s largest asset manager get its bitcoin ETF, IBIT, off the ground. He shifted to lead 21Shares’ US business in mid-2024.
I chatted with Brokate a few months before Trump’s election win. Among his points was how a solana ETF would “sit really nicely” in a portfolio alongside BTC and ETH funds.
Fast forward a year and the SEC again, just last week, delayed its decision on 21Shares’ proposed SOL product (and other similar proposals). Signs point to solana funds and single-asset ETFs holding other crypto assets gaining approval once the SEC greenlights a set of so-called “generic listing standards.” Perhaps October.
Crypto investment product AUM hit an all-time high of $244 billion on Aug. 13, according to CoinShares. Here’s a look at this year’s impressive flows (before this week, during which capital has leaked from BTC and ETH products):
Another point Brokate made last August? Advisers in the US are likely going to one day be the biggest buyer of crypto ETFs. Those financial pros don’t want to have to pick winners and losers.
As Hashdex CIO Samir Kerbage told me: “When multiple assets become investable, crypto index investing will be the natural path forward — offering diversification, risk mitigation and a simpler way for advisers and investors to gain exposure to the crypto economy.”
Hashdex has sought to expand the investment universe for its crypto index fund that currently just holds BTC and ETH. Crypto index funds by Grayscale and Bitwise gained SEC approval — but the agency issued stay orders to prevent them from listing for now.
