In a recent discussion on asset management strategies, Cole raised concerns about the practicality of implementing a strict 50% asset threshold for digital assets. According to the official information, his insights highlight the complexities and challenges faced by companies navigating the volatile landscape of cryptocurrencies.
Volatility and Rebalancing Challenges
Cole emphasized that the inherent volatility of digital assets would necessitate frequent rebalancing of indices, which could lead to increased costs and tracking errors. He pointed out that accurately measuring when holdings exceed the 50% threshold is further complicated by the presence of derivative instruments in the market.
Overlooked Players in the Market
Notably, he mentioned that significant players like Trump Media & Technology Group Corp, which holds the tenth-largest Bitcoin treasury, were overlooked in preliminary exclusion lists, despite their substantial Bitcoin holdings. These companies are strategically utilizing derivatives and ETFs to enhance their exposure to digital assets.
Proposed Alternative Approach
In light of these challenges, Strive proposes an alternative approach: the creation of an ex-digital asset treasury version of MSCI indices. This would provide asset owners with the flexibility to select benchmarks that align more closely with their investment strategies rather than adhering to a broad exclusion policy.
The recent bankruptcy of FTX has significantly impacted the cryptocurrency market, contrasting with the ongoing discussions about asset management strategies. For more details, see this article.








