Bitwise Raises $70M, Plans ETF Expansion Amid Institutional Crypto Boom

Bitwise, a prominent crypto asset manager, has raised $70 million in a funding round aimed at expanding its offerings as more institutional investors enter the cryptocurrency space. The company's CEO, Hunter Horsley, revealed that Bitwise plans to increase its headcount from around 100 to approximately 130 employees this year. Additionally, Bitwise is looking to introduce new exchange-traded funds (ETFs) and custom solutions to cater to the growing demand from institutional investors.

Bitwise currently offers three main investment categories: beta offerings, onchain solutions, and alpha strategies. The beta offerings include the company's crypto index fund, as well as bitcoin and ether ETFs. The onchain solutions bucket features non-custodial institutional staking through its acquisition of Attestant. The alpha strategies category involves custom separately managed accounts (SMAs) for large institutional clients, among other tailored solutions.

Horsley noted that there is growing interest among bitcoin owners in exploring ways to generate income or yield from their holdings. Bitwise, along with other fund groups, has proposals before the U.S. Securities and Exchange Commission (SEC) to launch ETFs that hold assets beyond BTC and ETH. Horsley believes that many investors prefer an index solution over building a portfolio of multiple single-coin ETFs.

Horsley praised the SEC's recent shift in attitude towards cryptocurrencies, describing it as "a night-and-day change" since Trump's inauguration. He noted that the agency has shown openness to a broader set of crypto-related products, although he declined to speculate on the timeline for approving ETFs beyond those holding BTC and ETH.

Despite the recent volatility in the crypto market, Horsley reported that mainstream investment professionals have shown increased interest in cryptocurrencies. He noted that while some individuals and traders may be bearish or fearful, particularly those exposed to small- and mid-cap cryptos, the overall interest from institutional investors remains strong.