Morgan Creek Digital and crypto index provider Bitwise are teaming up to launch a new index fund aimed at institutional investors looking to enter the digital asset market.
The Digital Asset Index Fund offers the top 10 largest digital assets weighted by market capitalization to accredited and other major investors, with Bitwise managing the fund itself. According to its official website, the index fund is geared heavily toward bitcoin, while offering exposure to other major cryptos like ether, bitcoin cash and EOS, among others.
Anthony Pompliano, a cryptocurrency bull and a partner at Morgan Creek Digital, said in a statement that the 2018 bear market provides an opportunity for investors to build out their exposure to the market.
He separately told CoinDesk in an email:
“We have been approached by many institutional investors who want to gain exposure to digital assets. By partnering with Bitwise, the leading crypto index provider, we are able to bring an institutional-grade solution to these clients. The crypto industry continues to mature and we see this as another milestone along the way.”
Bitwise CEO Hunter Horsley told CoinDesk that the fund is geared toward simplified access.
“[Morgan Creek chief investment officer] Mark Yusko and Morgan Creek have spent more than a decade working with institutional clients and earning their trust,” he explained. “Having a firm like them partnering with investors who want to explore and get exposure to the crypto space is a huge step in making it more accessible to institutions.”
Assets stored by the fund will be kept in cold storage to improve their overall security. These assets will be governed by a set of eligibility requirements which include custody qualifications, trade concentration limits and pre-mine restrictions.
To further the fund’s security, Morgan Creek and Bitwise intend to conduct annual audits. Yusko, Pompliano and Bitwise global head of research Matt Hougan will form a committee to oversee the fund as well.
Bitwise already offers accredited investors access to cryptocurrencies through its private index funds, as previously reported by CoinDesk. The firm is also seeking to launch an exchange-traded fund based upon the top 10 cryptocurrencies by market cap.