Bitcoin has hit new highs as of today, ethereum is making a run towards its May highs, and crypto exchanges are seeing massive volumes in trades with the interest in the space brought on by yesterday’s launch of (BITO), the first bitcoin futures ETF approved by the SEC.
Popular cryptocurrency exchange Coinbase announced last month that it would be offering direct deposit payments in any of the over 100 cryptocurrencies exchanging on the site because of customer demand. Within the next two weeks, that option is set to go live and will be fee-free, reports CNBC.
Users will be able to deposit any percentage of their paycheck and will have the option of depositing it as U.S. dollars or cryptocurrency. It will allow for users to be able to approach it like a 401k plan, should they choose, adding money on a continual, predictable basis, and is a great dollar-cost average approach for those looking to slowly add money to crypto without having to do a larger purchase all at once.
“We’re entering the phase of cryptocurrency where there’s a demand for people who want to be paid in digital assets,” said Douglas Boneparth, certified financial planner and president of Bone Fide Wealth in New York. “This will obviously allow people to put more of their money more easily into cryptocurrencies, and right or wrong is really determined by user and their preferences when it comes to money.”
Invesco Invests in the Growing Crypto Economy
The Invesco Alerian Galaxy Crypto Economy ETF (SATO) invests across the crypto industry in a variety of crypto-related categories that all could benefit from positive engagement and progress for crypto assets with the SEC approval of BITO this week. The fund invests across all market caps and within developed and emerging markets.
The fund seeks to track the Alerian Galaxy Global Cryptocurrency-Focused Blockchain Equity, Trusts and ETPs Index, an index that is divided into two different security types: digital asset companies that are engaged in cryptocurrency or the mining, buying, and enabling technologies of cryptocurrency, and exchange traded products (ETPs) and private investment trusts traded over-the-counter that are associated with cryptocurrency.
To be considered for the index, a company must have a minimum full market cap of $50 million, a minimum float-adjusted market cap of $10 million, a minimum free-float factor of 20%, a minimum average daily trading value of $1 million over the last three months, and it must also be listed on a global exchange. This portion of the index is given an 85% weighting.
ETPs and private investment trusts must have a minimum market cap of $1 billion (or $500 million for current constituents), a minimum average daily trading value of $15 million over the last three months, and an open structure to be considered for the index. This portion of the index is given a 15% weighting.
SATO does not invest directly in bitcoin, cryptocurrencies or crypto assets, or in initial coin offerings or futures contracts for cryptocurrencies, and it is non-diversified. The fund may gain exposure to securities within the ETP and Trust component indirectly through a Cayman Islands subsidiary. The subsidiary is wholly owned and advised by Invesco and may constitute no more than 25% of the fund.
The fund carries a 4.13% weight in Coinbase (COIN).
SATO carries an expense ratio of 0.60% and currently has 38 holdings.
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