Non-fungible tokens have recently taken the digital asset world by storm, with a trading volume of over $10 billion in the third quarter of this year. NFTs generally align at the intersection of art and the crypto world and offer a whole new avenue of investment opportunity for would-be crypto investors.
The fund provides diversified exposure to some of the most well-established NFT collections currently available and takes the hassle out of participating in auctions and bidding on the individual works of art available.
“New frontiers in art are rare. Entirely new artistic mediums are even rarer,” said Bitwise CIO Matt Hougan in the press release. “NFTs have emerged as the first digitally native medium for owning art and collectibles, with enormous potential for meaning, value, and use in our increasingly digital world. For many investors, that combination spells potential opportunity. The Bitwise Blue-Chip NFT Index Fund seeks to give these investors simple, diversified access to the digital art market’s most valuable collections in a meaningful way.”
The fund seeks to track the Bitwise Blue-Chip NFT Collections Index, a market cap-weighted index and comprises the ten biggest NFT collections. The index utilizes a methodology that attempts to optimize both price discovery and the liquidity of the securities it tracks.
This Bitwise fund works by purchasing and holding NFTs from the biggest collections in custody, all of which have a combined market cap of over $6 billion. Some of the constituents include Bored Ape Yacht Club, CryptoPunks, Autoglyphs, VeeFriends, Fidenza, and others.
“Since Bitwise launched the world’s first crypto index fund in 2017, our aim has always been to give investors a smart and convenient way to participate in crypto’s growth wherever that leads us,” said Bitwise CEO Hunter Horsley in the press release. “And recently, it’s become clear that any conversation about crypto’s potential must include NFTs, which are fundamentally changing how we think about not just owning art but property rights in general. Being able to invest in some of the NFT movement’s most defining collections as these evolve is an opportunity we wanted to make available to those who are as compelled by the space as we are.”
The NFT fund is only available for accredited investors with a private placement subscription and has a minimum $25,000 investment; after its initial lock-up period, the fund will give monthly redemptions. The Bitwise Blue-Chip NFT Index Fund carries an expense ratio of 3.0%.
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