ETFs are very popular in traditional investing for a good reason.
Purchasing an ETF is a fast way for an investor to diversify their holdings. The fund holds a variety of stocks dependent on investment strategy. That way, people are betting on sectors instead of having to place bets on individual companies and their shares.
Now, the world of crypto will experience a similar project. The aptly named First Crypto ETF will hold a basket of ten actively traded cryptocurrencies. The project, according to their White Paper, plans to encourage new investors to participate in cryptocurrency investing.
It’s not only new investors who love ETFs. In fact, large institutions own a ton of them because they protect the downside. Crypto trading, does not mimic the same fundamental nature that stock investing does, so finding real diversification in this sector is more difficult. That said, a crypto ETF will mimic the same sort of investment concept and will make it easier for people to put smaller bets on a diverse range of coins. First Crypto ETF will safeguard digital assets by providing hot and cold storage.
The Team Plans to Manage a Ten-Coin Etf Actively
Investors will purchase a token with a NAV based on ownership of ten underlying coins. The project promises to build a “Strategy Index” that does not merely allocate capital to the top ten coins by market cap. Instead, the team will invest In an allocate coin purchases based on varied criteria. The end user will not have to concern themselves with the basics of their trading but instead will have one token that is tradable.
The ten cryptocurrencies are Bitcoin (BTC), Monero (XMR), Litecoin (LTC), ZCash (ZEC), Lisk (LSK), Ethereum Classic (ETC), Ethereum (ETH), Ripple (XRP), Bitcoin Cash (BCH), and Dash (DASH). The ICO is seeking to sell 56,800,000 tokens for .2 EUR each. With the money, the team plans on hitting critical points in their roadmap, starting with building an exchange that allows for easy fiat conversion. In this initial phase, investors will use the exchange to trade ETFs. Once the project reaches a certain level of maturity, the ETF tokens would be available on other exchanges.
So far they have sold over 5.5 million tokens. As the money pours in, the project will move on the next phase of the roadmap. Once in place, First Crypto ETF could play a significant role for investors. The marketplace can always use additional exchanges, especially ones that allow ease of exchange into and out of fiat currency. If you’re interested in this ICO, or others, make sure to follow all applicable regulations for your jurisdiction. Investing in any new endeavor is risky, so weigh your options carefully. The current phase of developments shows that 2018 is a year which will see many building blocks come into play that could finally spur exponential growth. ETFs will play a substantial role in attracting capital and users, so we’ll be keeping an eye on First Crypto ETF to see how the project develops.