Coinbase is Bringing the Dow Jones to Cryptos
Coinbase President and COO Asiff Hirji was on CNBC’s Fast Money last night.
Everyone knew going in there was going to be a big announcement.
Most were hoping Coinbase would add Ripple (XRP) to its list of buyable coins. Buy Hirji shot that down.
Instead, Coinbase is going to be launching a weighted index fund for cryptocurrencies.
The new index for cryptocurrencies is called the Coinbase Index Fund.
Coinbase Index Fund will give investors exposure to all digital assets listed on Coinbase’s exchange, GDAX, weighted by market capitalization. If a new asset is listed on the exchange, it will be automatically added to the fund.
That means for now the fund will include BTC, ETH, LTC, and BCH.
It’s similar to the Dow Jones Industrial Average for the stock market. The DJIA tracks 30 of the most popular publicly owned companies in the market. The main difference is that the DJIA is price-weighted while the Coinbase Index Fund is weighted by market capitalization.
That means BTC will have the biggest influence on the index, followed by ETH, BCH, and LTC.
To start the Coinbase Index Fund will only be available to accredited investors in the US. It will have a $10,000 minimum investment and 2% annual management fee.
That’s exciting on its own. But what’s really exciting is the potential for a retail ETF.
“We are working towards funds that will be available to all retail investors,” said Reuben Bramanathan, product lead for the Coinbase Index Fund.
Unfortunately, he couldn’t give a time line. Let’s see if Coinbase can get past the SEC.
Despite the bullish news cryptos sold off over the last 24 hours.
What do you think of the new Coinbase Index Fund?
and trade cryptos on Binance
BTC, ETH, LTC, and BCH don't make up much of a "weighted index". I would expect a list of 10, at very least!
And I think the odds are extremely high that will eventually be the case once the fund is issued.
Top candidates for the other 6? Well, if Weiss's rankings are any indication, STEEM and BTS will be there.
That would mean direct fiat access to BTS and STEEM.
Now that would be bullish, for us anyway. 😎
I hope you're right, but I think EOS has a better chance making the list, along w NEO, ADA, XRP, XLM. Oh man I would love if STEEM got on there!!!
If the number 1 rated cryptocurrency by Weiss Ratings isn't on there, the entire credibility of the "index" will be put in question! STEEM has got to be there!
It seems like they should add neo cardano and dash and monero pretty soon and ripple and Stellar due to market cap. Eos after the token swap It just makes a lot of sense to have these tokens on the platform
nice information sir
Well what i think?
It's a great initiative, and if they add ripple, they will be much successful than ever.
The people are demanding XRP... seems like a no-brainer!
hahaha, you Don't like xrp?
Coins mentioned in post:
Oh if Coinbase only had the same list for its index, just one short ;-p
Much like how the Dow Jones Industrial Average gives a sense of the American economy, this fund tries to reflect major trends in the cryptocurrency market.
We'll be watching the crypto index right along the DJIA and Nasdaq in no time!
upvoted. Frankly, I think it's pretty lame. Anyone with $10K laying around can do way better than investing in this index fund. I certainly wouldn't do that. Returns are way better if one does one's own coin/token picks and invests in them diversifying enough to minimize the risk. I wouldn't touch this index fund. That's my opinion.
I see your point, only 4 coins isn't that exciting. But it's a start and paves the way for ETFs which would bring in a lot of $$$.
True. Could be a start of something big. Especially if minimum investment is reduced significantly. Most ETF's don't have a minimum like $10K. Just a price of 1 share is enough to invest in Vanguard/Schwab/eShares ETFs and that's why they are so huge now. Unlike Mutual funds that do require $3000 minimum investment, ETFs were invented to create a low cost entry for people who have less disposable/investable income. Hence, the popularity of ETFs speaks for itself.
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