On Tuesday, newcomer Viridi Funds launched its first ETF, the Viridi Cleaner Energy Crypto-Mining & Semiconductor ETF (RIGZ), which offers investors exposure to cryptocurrency that is environmentally sustainable. The fund is listed on the New York Stock Exchange
RIGZ is an active managed ETF that will invest in companies across the crypto mining industry and infrastructure, according to the press release. This includes producers of semiconductors and specialized computer chips, manufacturers of cryptocurrency mining rigs, as well as cryptocurrency mining companies and crypto miners.
RIGZ is launched through Alpha Architect’s growing white label business, Empowered Funds, LLC.
Investing in Cryptocurrency Mining in a Sustainable Fashion
Viridi believes that investing in Bitcoin mining is an excellent solution for the investors looking for exposure to crypto assets through the lens of environmental sustainability and active leadership. Over 50% of Bitcoin mining in North America is done utilizing renewable energy sources, and Viridi hopes to help widen this margin with products like RIGZ.
Wes Fulford, Chief Executive Officer of Viridi Funds, stated: "Bitcoin and cryptocurrencies continue to grow in importance, and we are witnessing a new wave of institutional support for this emerging asset class. We launched RIGZ to provide investors with an ETF that attempts to align purpose and profit by investing in the infrastructure that underpins the entire ecosystem with sustainability in mind.”
Fulford continues: "The rationale for owning a mining and infrastructure company is much the same as a senior gold producer – leveraged returns as compared to the underlying commodity. We believe that based on recent developments within the Chinese mining sector, North American miners that have access to sustainable low-cost power, large fleets of new-generation rigs, and access to capital are well positioned to generate higher returns during the months and years ahead.”
Viridi Funds Brings Experience to the Table
Viridi Funds is a registered investment advisor and emerging fund manager that offers environmentally conscious crypto investing options. Viridi is helmed by co-founder and CEO Wes Fulford, who was the former CEO and Director of Bitfarms Ltd, one of North America’s largest cryptocurrency mining ventures and one powered by more than 99% renewable energy. Both Fulford and co-founder Ethan Vera bring extensive investment banking and asset management experience to Viridi.
Viridi Funds will be the sub-advisor of RIGZ, and is backed by existing crypto sector companies such as CoinShares, Alameda Ventures, Fundamental Labs, and others.
The fund will not invest directly in cryptocurrencies but will likely have indirect exposure as many of the cryptocurrency miners carry Bitcoin, Ethereum, and other tokens on their balance sheets.
In addition, the Fund’s portfolio managers in equity securities of companies in the semiconductor industries, focusing on those that develop or manufacture computer chips used in crypto mining industries. Semiconductor companies will not be subject to the clean energy screen.
Securities will be evaluated and ranked on their clean energy profile, including the size of the miner’s operation (in megawatts (MW) of energy), the energy mix of the miner’s operation, the subcategory of energy mix (e.g., flared natural gas, coal, wind), purchased carbon offsets (described below), and future expected clean energy commitments (expected to be implemented within the next 12-month period) made by Miner’s management team.
In the absence of clear clean energy disclosures by companies, Viridi Funds will assume the miner uses coal, the worst-rated value on the firm’s clean energy scale, and one which would fail the clean energy screen.
RIGZ will invest in U.S. and developed market equities without capitalization limits; under normal circumstances, there will be between 15-30 stocks in the portfolio.
“We are excited to be launching RIGZ at such a pivotal point within the evolution of this market sector, and to be prioritizing investment into sustainable crypto mining practices through Viridi’s clean energy focus,” said Fulford.
RIGZ has an annual expense ratio of 0.90%.
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