Key Takeaways
- • Bitwise Asset Management is converting three crypto futures ETFs (BITC, AETH, BTOP) from long-only exposure to a momentum-based strategy that rotates between crypto futures and U.S. Treasuries.
- • The rotation signal is based on the 10-day and 20-day exponential moving averages (EMA) of bitcoin and ether prices: funds hold crypto futures when the 10-day EMA is above the 20-day EMA and move to Treasuries when it is below.
- • The three funds are renamed as the Bitwise Trendwise Bitcoin and Treasuries Rotation Strategy ETF (BITC), the Bitwise Trendwise Ethereum and Treasuries Rotation Strategy ETF (AETH), and the Bitwise Trendwise BTC/ETH and Treasuries Rotation Strategy ETF (BTOP).
- • Expense ratios are unchanged (AETH 0.90% net, BITC 0.88% net, BTOP 0.90% net), and existing shareholders need take no action as the conversion is automatic.
- • The announcement follows a busy 2024 for Bitwise, including the launch of spot bitcoin and ether ETPs, the August acquisition of ETC Group, an October filing for a spot XRP ETP, and the November acquisition of Attestant.
Summary
Bitwise Asset Management announced on December 3, 2024 that it is converting three of its crypto futures ETFs from long-only strategies to Trendwise strategies that rotate exposure between cryptocurrency futures and U.S. Treasuries based on crypto price trends. The proprietary momentum-based approach is designed to help investors seeking bitcoin or ether exposure improve risk-adjusted returns by managing downside risk, according to the firm's announcement.
The Trendwise strategy relies on a proprietary signal built from the 10-day and 20-day exponential moving averages of the two leading crypto assets, bitcoin and ether. Under the stated methodology, the funds invest in crypto futures when the 10-day EMA is above the 20-day EMA, a signal that prices are gaining momentum, and rotate into U.S. Treasuries when the reverse holds. The fund documentation describes the approach as a "long-flat" trend-following strategy, under which the adviser shifts exposure between 100% crypto futures and 100% Treasuries. The funds do not hold bitcoin or ether directly, and the documentation warns that there may be extended periods with no crypto futures exposure.
The affected funds are BITC, which will become the Bitwise Trendwise Bitcoin and Treasuries Rotation Strategy ETF; AETH, which will become the Bitwise Trendwise Ethereum and Treasuries Rotation Strategy ETF; and BTOP, which will become the Bitwise Trendwise BTC/ETH and Treasuries Rotation Strategy ETF. Bitwise stated there is no change to the funds' expense ratios or tax treatment. Net expense ratios are 0.90% for AETH, 0.88% for BITC and 0.90% for BTOP, with gross ratios of 1.57%, 3.39% and 1.36% respectively. Existing investors need take no action, as the funds will convert automatically.
CIO Matt Hougan said investors want "smart exposure" to crypto, and that the strategies capitalize on momentum in crypto markets to boost risk-adjusted returns while reducing downside risk. Teddy Fusaro, President of Bitwise, described the strategies as new options for accessing the market. The filings also caution that there is no guarantee the methodology will achieve positive returns or outperform other products, that futures can differ significantly from spot prices, and that the Treasury sleeve is not FDIC insured.
The launch comes during a busy 2024 for Bitwise, which introduced its first spot bitcoin and ether ETPs during the year, acquired European crypto fund provider ETC Group in August, filed for a spot XRP ETP in October, and acquired staking firm Attestant in November.
The Trendwise strategy relies on a proprietary signal built from the 10-day and 20-day exponential moving averages of the two leading crypto assets, bitcoin and ether. Under the stated methodology, the funds invest in crypto futures when the 10-day EMA is above the 20-day EMA, a signal that prices are gaining momentum, and rotate into U.S. Treasuries when the reverse holds. The fund documentation describes the approach as a "long-flat" trend-following strategy, under which the adviser shifts exposure between 100% crypto futures and 100% Treasuries. The funds do not hold bitcoin or ether directly, and the documentation warns that there may be extended periods with no crypto futures exposure.
The affected funds are BITC, which will become the Bitwise Trendwise Bitcoin and Treasuries Rotation Strategy ETF; AETH, which will become the Bitwise Trendwise Ethereum and Treasuries Rotation Strategy ETF; and BTOP, which will become the Bitwise Trendwise BTC/ETH and Treasuries Rotation Strategy ETF. Bitwise stated there is no change to the funds' expense ratios or tax treatment. Net expense ratios are 0.90% for AETH, 0.88% for BITC and 0.90% for BTOP, with gross ratios of 1.57%, 3.39% and 1.36% respectively. Existing investors need take no action, as the funds will convert automatically.
CIO Matt Hougan said investors want "smart exposure" to crypto, and that the strategies capitalize on momentum in crypto markets to boost risk-adjusted returns while reducing downside risk. Teddy Fusaro, President of Bitwise, described the strategies as new options for accessing the market. The filings also caution that there is no guarantee the methodology will achieve positive returns or outperform other products, that futures can differ significantly from spot prices, and that the Treasury sleeve is not FDIC insured.
The launch comes during a busy 2024 for Bitwise, which introduced its first spot bitcoin and ether ETPs during the year, acquired European crypto fund provider ETC Group in August, filed for a spot XRP ETP in October, and acquired staking firm Attestant in November.
Go deeper than the headline
Research every firm in this story, track the ones that matter and get the daily briefing — free for 7 days.