$162 Billion Asset Manager Files for a Crypto Basket ETF

Victory Capital Management, the wholly-owned investment advisor of Victory Capital Holding, which has $161.9 billion in assets under management, has launched the Victory Hashdex Nasdaq Crypto Index Fund LLC.

This private fund that provides US accredited investors access to digital assets tracks the Nasdaq Crypto Index (NCI).

This crypto basket fund is primarily made up of Bitcoin (BTC) and Ether (ETH), having 62.39% and 31.70% weightage, respectively. Other crypto assets in this fund include Uniswap (UNI), Chainlink (LINK), Litecoin (LTC), Stellar (XLM), Filecoin (FIL), and Bitcoin Cash (BCH).

The core exchanges of the index include Bitstamp, Coinbase, Gemini, itBit, and Kraken, while BitGo, Fidelity, Coinbase, and Gemini are the custodians.

The Nasdaq Crypto Index will be rebalanced quarterly, charging a management fee of 1.75%. Subscription can be made daily, while daily redemptions come with 3 business days' notice. The fund has a minimum initial investment requirement of $25,000 and subsequent investments of $10,000.

Coming without any lockups, unlike the world’s largest digital asset manager, Grayscale, the company believes this new private is unique due to its multi-coin access, daily liquidity at NAV, and Nasdaq index governance.

“We’re confident we’re on the verge of fast and remarkable advancements in this arena, and the Victory Hashdex Nasdaq Crypto Index Fund, along with a potential future ETF offering, will provide our clients with convenient exposure to multiple coins while introducing a new asset class for their portfolios,” said Mannik Dhillon, CFA, CAIA, President of VictoryShares & Solutions.

The company also filed an initial registration statement with the SEC to offer the Fund strategy in an ETF vehicle.

This new filing comes as Grayscale announced veteran David LaValle as its global head of ETF.

“Kinda interesting timing given the cold water Gensler poured on 33 Act physical bitcoin ETFs. Prob had it planned bf then and just want to get hat in ring. But prob not getting approved anytime soon,” commented Eric Balchunas, Senior ETF Analyst at Bloomberg.

Speaking at the Aspen Security Forum on Tuesday, US SEC Chair Gary Gensler said he is interested in a Bitcoin ETF which complies with the SEC’s strict rules for mutual funds, which left the industry disappointed because such an ETF doesn’t get much traction.

It’s all about physically-backed ETF, as can be seen in the case of bullion, where gold futures ETF DGL has less than 1% of the assets of physically-backed gold ETFs.

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