US-based crypto investment firm Bitwise is launching an index fund that offers accredited investors exposure to top NFT collections, the company said in a press release Thursday.
This investment trust, called the Bitwise Blue-Chip NFT Index Fund, tracks the performance of the 10 largest NFT collections, including CryptoPunks, Bored Ape Yacht Club, Mutant Ape Yacht Club, Autoglyphs, Fidenza, VeeFriends, CyberKongz Genesis, Cool Cats, Meebits, and Chromie Squiggle.
According to the company, the NFT collections were chosen on the basis of their market cap using floor prices. The collections will be rebalanced quarterly for best results. Bitwise will directly purchase and hold NFTs from the above-mentioned collections, which have a combined market value of $6 billion, to offer direct exposure to digital collectibles.
In addition, since the investment trust focuses on art and collectibles, NFTs such as virtual lands, music rights, and gaming-related NFTs will not be included in the fund.
Bitwise CIO Matt Hougan said in the announcement:
“NFTs have emerged as the first digitally native medium for owning art and collectibles, with enormous potential for meaning, value, and use in our increasingly digital world. For many investors, that combination spells potential opportunity. The Bitwise Blue-Chip NFT Index Fund seeks to give these investors simple, diversified access to the digital art market’s most valuable collections in a meaningful way.”
Sales of NFT investment trusts are limited to accredited investors and require a minimum investment of $25,000 from interested investors. At the moment, investors cannot trade the fund in secondary markets. However, the trusts may trade in the secondary market via OTCQX of major OTC exchanges after receiving approval from the US SEC.