One of Bitwise’s top ten cryptomorphic indices outperforms the assets themselves as the FOMO takes over.
Bitwise 10′ Crypto Index debuts with a record 369% premium NEWS
The Crypto Index Fund Manager Bitwise Asset Management, announced that his 10 Crypto Index Fund is trading at a much higher premium than the underlying assets it represents.
The BITW fund has recorded record initial trading volumes, with the fund’s crypto shares rising 369% above the value of Bitcoin, Ethereum and the eight other crypto assets it owns.
Bloomberg reported that the divergence indicates that Immediate Bitcoin institutional investors, hedge funds and retail traders are willing to pay a premium to access the fund through an exchange, rather than buying the underlying assets directly.
Nasdaq reported that more than $67 million in shares were traded in the first three days, making it the largest publicly traded crypto asset fund debut in US history. The Bitwise 10 fund was listed on the OTCQX Best Market, a market for over-the-counter equity trading, on 9 December.
The previous record holder was the Grayscale Ethereum Trust, which had just over $9 million in trading volume during the first three days after its debut on OTCQX on June 25, 2019. Today, Grayscale is the largest crypto fund, with $13.7 billion in assets under management according to its latest tweet. Bitwise is a comparative fish at this point, as it has only $168 million AUM in this particular fund.
The fund is an index that considers the top ten digital assets and rebalances the list monthly. Three assets that are among the top ten by market capitalization reported are absent from the fund; Cardano, Polkadot and Binance Coin.
The fund has a net asset value (NAV) of $18.55 and a market price of $139, as reported on Wednesday, December 16. Bloomberg added that NAV premiums often occur in the world of exchange traded funds (ETFs), but rarely exceed movements of 3% or more.
Multicoin Capital co-founder and managing partner Kyle Samani said that people buying at the fund are saying „I don’t understand Bitcoin, just give me a reasonably constructed index:
„I don’t think they can justify the prize, I just don’t think they know what they’re buying. It’s not justifiable, it’s just ignorance. ”