Bitwise, a well-known digital asset manager, has filed for a Chainlink ETF to provide investors with a reliable way to access cryptocurrencies.
What the Filing Means
The Form S-1 is a requirement for companies looking to issue securities to the market. In this case, Bitwise is working to register shares for a Chainlink-backed ETF, managed by a trust registered in Delaware and sponsored by Bitwise Investment Advisers, LLC.
How the ETF Works
The ETF will operate through direct ownership of Chainlink tokens. Its NAV will be pegged to the market price of LINK as determined by the CME CF Chainlink-Dollar Reference Rate. It will issue and redeem large baskets of 10,000 shares each, and Authorized Participants can exchange directly in Chainlink or pay in U.S. dollars.
Custody and Risks
Custody will be managed by Coinbase Custody Trust Company, LLC, holding tokens in cold storage wallets. Insurance policies will help protect against potential breaches, though substantial risks remain, including price volatility, regulatory uncertainties, and technological risks.
With its filing for a Chainlink ETF, Bitwise is striving to integrate cryptocurrencies into traditional finance, signaling significant potential for institutional investment in LINK.
