Will Coinbase’s Index Fund Attract New Institutional Money?

JUNE 14, 2018 BY CHRIS PERROTTA

Coinbase releases Coinbase Index Fund which allows U.S. accredited investors the opportunity to purchase all of the available assets on the platform based on the current weighted market capitalization. Future assets will be re-balanced into this fund at time of listing.

Coinbase announced the release of Coinbase Index Fund in a Medium post on June 12th. While this is strictly for U.S. accredited investors, it is an important infrastructural step. Any U.S. accredited investor with funds from $250,000 – $20,000,000 now has the ability to purchase all assets listed on their exchange at once, Bitcoin (BTC), Ethereum(ETH), Bitcoin Cash (BCH), and Litecoin (LTC), weighted by market capitalization. This is similar to what rival company, Circle, has recently done.

While it does not directly add much value to the platform, investors can just allocate the assets themselves, it does allow a less educated investor to feel safer allocating their portfolios in a predetermined way. This works much like a mutual fund does in the traditional stock market. Potentially by diversifying their portfolio, less risk is incurred.

With the upcoming listing of Ethereum Classic (ETC), Coinbase has said they will rebalance the index to include ETC and any other asset they choose to add in the future. It will be interesting to see what coin(s) they add next, as many people are already speculating which one it will be, Ripple (XRP), OX (ZRX), Zcash (ZEC)? Let us know in the comment section what coin you think will be listed next.

Originally published at altcoinbuzz.io on June 14, 2018.

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