The U.S. Securities and Exchange Commission (SEC) approved ETFs based on Bitcoin and Ethereum, offered by Hashdex and Franklin Templeton. These ETFs provide institutional access to the two largest digital assets.
The Approved ETFs: What They Offer
The approvals cover two funds: Hashdex Nasdaq Crypto Index US ETF and Franklin Templeton Crypto Index ETF. Franklin Templeton’s ETF tracks the Institutional Digital Asset Index, reflecting the performance of Bitcoin and Ethereum. Hashdex’s ETF is tied to the Nasdaq Crypto US Settlement Price Index, also focused on Bitcoin and Ethereum. Both funds prioritize transparency, regulatory compliance, and investor protection. Initially, the Hashdex Crypto Index ETF will include only Bitcoin and Ethereum, with plans to expand to other digital assets, potentially including XRP.
Industry Reactions
Popular ETF analyst Eric Balchunas noted that both funds are market cap-weighted, likely allocating around 80% to Bitcoin and 20% to Ethereum. He expects the launch to occur in January. Nate Geraci, president of The ETF Store, speculated that other firms, including BlackRock, might follow suit, commenting that "there will be meaningful demand for these products. Advisors love diversification, especially in an emerging asset class like crypto."
Impact on the Cryptocurrency Market
Approval of Bitcoin and Ethereum ETFs brings institutional credibility to the crypto market. It allows traditional investors to diversify portfolios without directly holding volatile digital assets. This change is particularly crucial for financial advisors seeking regulated, transparent options for clients interested in cryptocurrencies. On social media, artist Chad Steingraber highlighted the potential inclusion of XRP in the Hashdex ETF, sparking interest among crypto enthusiasts.
With the SEC's approval of Bitcoin and Ethereum ETFs, the cryptocurrency market gains significant recognition and support, opening up new opportunities for investors.
