Bitwise Launches ETF for Companies Holding Bitcoin

Bitwise Asset Management has introduced the Bitwise Bitcoin Standard Corporations ETF, which trades under the ticker OWNB. This exchange-traded fund is designed to provide investors with exposure to companies that hold significant Bitcoin reserves as part of their corporate treasury strategies. The ETF tracks the Bitwise Bitcoin Standard Corporations Index, which includes firms that have integrated Bitcoin into their financial holdings.

The launch of the Bitwise Bitcoin Standard Corporations ETF reflects a growing trend among companies to allocate a portion of their cash reserves to Bitcoin. This shift is driven by the perception of Bitcoin as a strategic reserve asset that is both liquid and scarce, offering a hedge against monetary instability. Matt Hougan, Bitwise’s Chief Investment Officer, noted that businesses collectively hold trillions of dollars in cash while the U.S. government runs an annual deficit exceeding $2 trillion. He explained that many firms now view Bitcoin as an alternative store of value, independent of government monetary policies.

Bitwise CEO Hunter Horsley highlighted that more than 70 companies now hold Bitcoin in their corporate treasuries, following the example set by firms such as Strategy. He emphasized that the ETF allows investors to gain diversified exposure to companies that have embraced Bitcoin as part of their financial strategies. The ETF tracks companies with at least 1,000 Bitcoin in their treasuries, with the top holdings at launch including Strategy, MARA Holdings, CleanSpark, Riot Platforms, Boyaa Interactive, Metaplanet, Aker ASA, Bitfarms, BitFuFu, and Galaxy Digital.

The index weighs holdings based on the amount of Bitcoin owned while maintaining diversification limits, including capping the largest holding at 20 percent at each rebalance. Additionally, companies with Bitcoin holdings representing less than 33 percent of their total assets receive an automatic fixed weighting of 1.5 percent. The index is rebalanced quarterly to maintain its structure. Bitwise stated that the ETF will not invest in Bitcoin directly or through derivatives but instead seeks to capture the financial performance of corporations with significant Bitcoin exposure.

Bitwise suggested that the growing trend of companies turning to Bitcoin as an alternative asset is driven by the significant cash reserves held by U.S. nonfinancial corporations. As of the third quarter of 2024, these corporations collectively held over $4.5 trillion in cash and deposits and nearly $1 trillion in U.S. Treasuries