WisdomTree has expanded its digital assets product range with the launch of three physically backed cryptocurrency basket ETPs in Europe.
Jason Guthrie, Head of Digital Assets, Europe, WisdomTree.
The new products comprise the WisdomTree Crypto Mega Cap Equal Weight ETP (MEGA), the WisdomTree Crypto Market ETP (BLOC), and the WisdomTree Crypto Altcoins ETP (WALT).
MEGA has been listed on SIX Swiss Exchange (MEGA SW, MEGAEUR SW, MEGACHF SW), Xetra (WMEG GY), Euronext Paris (MEGA FP) and Euronext Amsterdam (MEGA NA), while BLOC and WALT have been listed exclusively on SIX Swiss Exchange (BLOC SW, BLOCEUR SW, BLOCCHF SW) and Xetra (WBLC GY).
The ETPs track proprietary indices developed by WisdomTree in collaboration with CF Benchmarks, a third-party index provider and calculation agent specialising in crypto assets.
The ETPs enable investors to access a range of crypto assets without the need to hold them directly, store private access keys or interact with the blockchain or digital currency infrastructure in any way. Investors in the products also benefit from institutional-grade storage solutions without the need to set it up with a custodian themselves.
The products
The WisdomTree Crypto Mega Cap Equal Weight ETP tracks the WisdomTree CF Crypto Mega Cap Equal Weight Index, providing an equal-weighted allocation to mega-cap crypto assets, currently Bitcoin (BTC) and Ethereum (ETH), with a quarterly rebalance. The ETP provides investors with a simple, secure, and cost-efficient way to gain exposure to the mega-cap portion of the cryptocurrency market.
WisdomTree expects this product to appeal to those seeking diversified exposure to the most established cryptocurrencies and investors wanting to capture potential outperformance delivered through regularly rebalancing back to an equal-weighted exposure. MEGA has a total expense ratio (TER) of 0.95%.
The WisdomTree Crypto Market ETP is free-float market-cap-weighted, providing exposure to a diversified basket of crypto assets representing circa 70% of the cryptocurrency market cap. The ETP is designed for those looking for broad exposure to the liquid, more established end of the crypto market. The ETP’s underlying index – the WisdomTree CF Crypto Market Index – is currently composed of Bitcoin, Ethereum, Cardano, Bitcoin Cash, Litecoin, Polkadot and Solana.
The ETP rebalances on an annual basis to capture the momentum of the digital asset ecosystem market as it grows. Due to the market cap of Bitcoin and Ethereum, the combined weighting of these crypto assets is capped at 75%, with individual constituents capped at a max weighting of 45% and a minimum allocation of 2.5% per crypto asset. BLOC has a TER of 1.45%.
The WisdomTree Crypto Altcoins ETP is also free-float market-cap-weighted, providing exposure to a diversified basket of altcoins. The ETP provides exposure to major coins excluding BTC and ETH. It was designed for investors who already have exposure to mega-cap coins and want to diversify their exposure without changing their existing holdings. The ETP’s underlying index – the WisdomTree CF Crypto Altcoins Index – is currently composed of Cardano, Bitcoin Cash, Litecoin, Polkadot and Solana.
The ETP similarly rebalances on an annual basis to capture the momentum of the digital asset ecosystem market as it grows. Individual constituents are capped at a max weighting of 50% and a minimum allocation of 2.5% per crypto asset. WALT has a TER of 1.45%.
‘Institutional-grade basket ETPs’
Commenting on the new launches, Jason Guthrie, Head of Digital Assets, Europe, WisdomTree said: “We believe in the power of this new asset class. It is a truly transformative technology and the pace of innovation in the space is staggering. There is now $2.6 trillion dollars of value captured by the asset class which didn’t exist pre-2009. As it inevitably continues to grow in prominence, institutions need an increasingly sophisticated tool kit to enable them to provide access effectively and efficiently to crypto-asset markets for their clients. That is exactly what we have developed here: a range of institutional-grade basket ETPs that allow investors to gain diversified exposure to crypto markets and, more broadly, participate in the potential growth of the decentralised economy including native cryptocurrencies, payments, smart contacts, DeFi & NFTs. These are truly disruptive technologies, and we expect the importance of the asset class to grow within investors’ portfolios.”
Alexis Marinof, Head of Europe, WisdomTree, added: “We are evolving our offering and building a proposition that is built around the client and innovation. By leveraging our heritage of innovation we’re able to deliver exposures that investors are unable to find elsewhere in an ETP wrapper. Interest in cryptocurrencies remains high and professional investors are seeking innovative products and a trusted partner to support them on their crypto assets journey. We are committed to supporting the needs of investors by producing high-quality research, providing superior client engagement, and building best-in-class products. As the asset class become a bigger focus for investors, we will continue to invest in our platform and capabilities to ensure we’re at the cutting edge.”
The products have been passported for sale across much of the European Union including Austria, Belgium, Denmark, Finland, France, Germany, Italy, Ireland, Luxembourg, Netherlands, Norway, Spain, Sweden and Switzerland.