Bitwise Shifts Strategies for Crypto ETFs Amid XRP Developments

• Bitwise’s new strategy seeks to combine crypto futures with US Treasuries.
• The Trendwise strategy aims to minimize downside risk through market momentum.
• Bitwise’s filing for a spot XRP ETF enhances its investment offerings in cryptocurrency.

Bitwise Asset Management has initiated a significant change in its investment approach by filing to convert three of its crypto futures ETFs.

The company aims to implement a strategy that dynamically rotates investments between cryptocurrency futures and US Treasuries based on market trends. This innovative strategy, named “Trendwise,” is designed to mitigate downside risk while seeking to enhance long-term returns.

Effective on or about December 3, 2024, Bitwise’s Bitcoin Strategy Optimum Roll ETF will be rebranded as the Trendwise Bitcoin and Treasuries Rotation Strategy ETF, under the ticker symbol BITC. 

Additionally, the Ethereum Strategy ETF will now be called the Trendwise Ethereum and Treasuries Rotation Strategy ETF, while the Bitcoin and Ether Equal Weight Strategy ETF will transition to the Trendwise BTC/ETH and Treasuries Rotation Strategy ETF. These adjustments reflect Bitwise’s commitment to improving risk-adjusted returns in the rapidly changing financial landscape.

According to Bitwise’s Chief Investment Officer, Matt Hougan, momentum plays a crucial role across various asset classes, including cryptocurrencies. The Trendwise strategy leverages this momentum through a methodical approach that adjusts allocations based on the direction of market movements. 

In particular, Bitwise uses its own momentum signal based on the 10-day and 20-day exponential moving averages to navigate its changes in investment.

The funds will especially keep investing in the Cryptocurrencies when the 10-day EMA is over the 20-day EMA which indicates an upward movement. On the other hand, should the trend reverse, the strategy will focus on US Treasuries instead.

Bitwise has also recently filed an S-1 registration with the SEC for a spot XRP ETF. This move signifies the firm’s ongoing expansion in the crypto investment space, aiming to provide investors with direct exposure to Ripple Labs’ digital asset. 

Should the SEC approve this filing, it would facilitate greater access to XRP through a regulated financial product, further integrating cryptocurrency into mainstream investment options.

The ETF landscape has seen rapid developments this year, with Bitwise launching its first spot Bitcoin ETP in January and its inaugural Ethereum ETP in July. The firm also expanded its European footprint by acquiring the crypto fund provider ETC Group.