Wall Street Could Get an ETF for Crypto Treasury Firms
Wall Street could soon be getting a new exchange-traded fund that bundles up crypto treasury companies, alongside four other funds from crypto trading and market-making firm GSR.
The company is looking to launch the GSR Digital Asset Treasury Companies ETF, according to a regulatory filing on Wednesday, which would invest in public companies such as the Bitcoin (BTC) buying Strategy or the Ether (ETH) holding BitMine Immersion Technologies.
The filing, GSR’s first-ever foray into ETFs, also lists four other funds involving ETH and crypto staking, with one that looks to bundle and track the price of Bitcoin, Ether and Solana (SOL).
Crypto treasury companies buy and hold crypto for the long term, which has become a popular move due to attracting significant funding. Some have bet on riskier altcoins to get investor attention, alarming some analysts who have warned of an oversaturated market.
Crypto treasury ETF agnostic on holdings
GSR said in its filing that its crypto treasury ETF would buy shares in public companies that own crypto, and seemingly doesn’t limit the fund to companies holding major tokens like Bitcoin or Ether.
“The Fund, under normal market conditions, will invest at least 80% of its net assets (plus any borrowings for investment purposes) in equity securities of companies that hold digital assets in their corporate treasury,” the filing reads.
It defined its possible investments as “any company that generally maintains a significant portion of its assets in one or more digital assets,” and specified that the ETF doesn’t have minimum market capitalization requirements for the companies it’d invest in.
The ETF initially looks to hold “10–15 positions comprised of 5 to 10 issuers,” and some examples of treasury companies could include Sui (SUI) buying SUI Group Holdings and the BNB (BNB) holding firm CEA Industries.
GSR looks to launch three staking ETFs
The filing also details the GSR Ethereum Staking Opportunity ETF, the GSR Crypto StakingMax ETF and the GSR Ethereum YieldEdge ETF, which all seek to involve staking rewards.
The Ethereum Staking and YieldEdge ETFs will both use an offshore wholly-owned subsidiary to buy and stake ETH on behalf of the fund, as they were filed under the Investment Company Act of 1940, the so-called “40 Act,” which has limitations on what the ETF can hold.
GSR’s Ethereum Staking fund will also invest in Ether staking ETFs, mostly based outside the US, while the YieldEdge ETF will use an “actively managed derivatives strategy designed to enhance yield.”
It’s StakingMax ETF, also filed under the 40 Act and using an offshore subsidiary, will aim to invest in cryptocurrencies and securities “with a particular emphasis on proof-of-stake (“PoS”) cryptocurrencies and staking strategies.”
Bitcoin, Ether, Solana bundle ETF could hold directly
GSR’s fifth ETF in the filing is the GSR Crypto Core3 ETF, which will look to track Bitcoin, Ether and Solana and could directly hold the tokens.
The Core3 ETF was filed under the Securities Act of 1933, the same as the hugely popular spot Bitcoin and Ether exchange-traded products that launched last year.
GSR said the ETF aims to give “balanced exposure to three of the most established digital assets” and would “maintain allocations of approximately one-third of its net assets” each to Bitcoin, Ether and Solana.
GSR’s filing comes as other asset managers have launched similar ETFs, including some with staking and others that track a group of crypto tokens, as Wall Street looks to gain exposure to the market.
Magazine: Bitcoin mining industry ‘going to be dead in 2 years’ — Bit Digital CEO