Bitwise ETFs To Seamlessly Rotate Between Bitcoin and Treasuries

Bitwise Asset Management is seeking to transition its crypto futures ETF (exchange-traded fund) from long-only strategies to a model that alternates between crypto and US Treasuries based on market dynamics.

The growth of crypto adoption is evident, particularly with institutional entities such as Bitwise expanding their influence in this domain.

Bitwise Aims for Its Futures ETFs to Adapt with Crypto and US Treasuries Trends

The company is advocating for a shift to strategic financial instruments that demonstrate adaptability to market trends by providing exposure to both crypto and US Treasuries.

“Bitwise has submitted another ETF filing, featuring a treasury and bitcoin rotation strategy. The ticker will be BITC,” remarked ETF expert James Seyffart .

The conversion process is anticipated around December 3, 2024, with the funds projected to update their names and strategies, specifically:

• BITC, currently the Bitwise Bitcoin Strategy Optimum Roll ETF, will rebrand to the Bitwise Trendwise Bitcoin and Treasuries Rotation Strategy ETF.
• AETH, now the Bitwise Ethereum Strategy ETF, will transition to the Bitwise Trendwise Ethereum and Treasuries Rotation Strategy ETF.
• BTOP, the Bitwise Bitcoin and Ether Equal Weight Strategy ETF, will change to the Bitwise Trendwise BTC/ETH and Treasuries Rotation Strategy ETF.

Read more: What Is a Bitcoin ETF?

The ETFs will implement Bitwise’s proprietary “Trendwise” model, which rotates investments between crypto and Treasuries. This approach aims to reduce downside volatility while fostering long-term price growth.

“The new Trendwise strategies leverage momentum via a trend-following mechanism that shifts between crypto and Treasuries, depending on market trends. The objective is to minimize downside risk and potentially enhance risk-adjusted returns,” stated Bitwise CIO Matt Hougan in a press release .

This strategy employs 10- and 20-day exponential moving averages (EMA) for crypto assets like Bitcoin and Ethereum, investing in these assets when the 10-day EMA exceeds the 20-day EMA, signaling positive momentum. Conversely, when the trend reverses, the focus shifts to Treasuries.

Despite these upcoming changes, the funds’ expense ratios and tax treatments will remain unchanged, meaning existing investors are not required to take any action prior to the conversions.

Bitwise is a significant player in the cryptocurrency market, offering exposure to Bitcoin and Ethereum through its ETFs, BITB and ETHW. In August, the firm broadened its presence by acquiring the European crypto fund provider ETC Group and recently submitted a proposal for a spot XRP ETP.

However, amidst these developments, Bitwise is contending with legal challenges. According to BeInCrypto, Vandelay Industries has accused Bitwise and its executives of financial wrongdoing, seeking damages of $2 million. This lawsuit introduces a contentious element to what has otherwise been a notable year for the asset management company.