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CoinShares Introduces DeFi Index Token for Institutional Investors

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The DeFi Index token consists of wrapped assets – the company’s gold token DGLD (wDGLD), Bitcoin (wBTC), and Ethereum (wETH). 

CoinShares, the world’s first digital asset investor to launch a regulated Bitcoin (BTC) investment fund, has released decentralized finance (DeFi) Index Token to target institutional investors. Named CoinShares Gold and Cryptoassets Index Lite (CGI) token, it was built on the Ethereum (ETH) blockchain.

According to CoinShares, the DeFi Index token is an adaptation of the CoinShares Gold and Cryptoassets Index (CGCI) the company launched back in May 2020. It consists of wrapped assets – the company’s gold token DGLD (wDGLD), Bitcoin (wBTC), and Ethereum (wETH).

As for the index, it utilizes the concept of volatility harvesting by forming a basket of crypto assets and combining it with gold using weighted-risk contribution as a rebalancing mechanism. According to CoinShares’ document, CGCI aims to reduce volatility as well as yield superior risk-adjusted returns in contrast with a number of alternative strategies like holding crypto assets or gold alone.

CoinShares Chairman Danny Masters stated:

“When [institutional investors] came to the commodity space, they wanted an index.”

Further, Masters added that the same story will take place with digital assets.

CoinShares’ Vision of Bitcoin’s Future

CoinShares is one of the public companies with the largest Bitcoin portfolios. The company believes that Bitcoin and blockchain networks are “landmark innovations that will fundamentally reshape the global financial system, and investors should be able to participate in this transformation.” Besides, CoinShares executive chairman Daniel Masters is sure that those portfolio managers who don’t invest in Bitcoin are taking a career risk. Previously, he said that not having it in your portfolio could now get you fired. 

Last month, CoinShares even launched its physically-backed Bitcoin Exchange Traded Product (ETP), CoinShares Physical Bitcoin (BITC). Initially, BITC appeared on the regulated SIX Swiss Exchange and had a base fee of 0.98%. It launched with approximately $200mn in AUM, a level that allows BITC to meet institutions and corporates’ baseline for investment consideration.

According to CoinShares analysts, Bitcoin portion in a 60% stock and 40% bond portfolio should total 4%.

Meltem Demirors, CoinShares chief strategy officer, explained:

“Our research has found that in a traditional 60-40 portfolio, a 4% allocation to bitcoin balances the reward as well as the risk of drawdowns.”

Besides, Demirors believes that regulatory issues will unlikely be a problem for Bitcoin. She said:

“The regulatory issues have been around for a long time, we’ve been dispelling them for a long time. At this point, our belief is: Bitcoin is not a question of if, but when. We certainly believe, you know, the best time to invest in bitcoin was yesterday – the second best time to allocate is today.”

While Demirors is warning investors should not allocate much to Bitcoin, the currency is hitting new records. Last week, its market cap surpassed $1 trillion. Besides, it soared to a new all-time high (ATH) at $56,421.14 on Friday.

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Daria is an economic student interested in the development of modern technologies. She is eager to know as much as possible about cryptos as she believes they can change our view on finance and the world in general.



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‘Shift 1% of Portfolio into Bitcoin’, JPMorgan Advises Investors as Bull Run Cools Off

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Analysts of JPMorgan highlighted the evaporating liquid supply as multi-billion dollar institutions and corporations are buying substantial quantities at a fast rate.

JPMorgan Chase & Co (NYSE: JPM) strategists have suggested that investors should consider moving 1% of their portfolio into Bitcoin to serve as a hedge against fluctuations in traditional asset classes including stocks, bonds, and commodities.

Many people over the years including the majority of Wall Street saw Bitcoin as a commodity without any strong backing, hence doubting its ability to perform and stay in the financial scene. It seems the narrative about the biggest digital coin is gradually changing which is evident in the new wave of institutional influx in the crypto market. 

The latest endorsement from the US multinational investment bank, JPMorgan has boosted the already existing notion which has seen many experts tout Bitcoin as a hedge against inflation. The bank has told its investors that they can shift 1% of their portfolio into Bitcoin only if those investors have just a small interest in Bitcoin.

Analysts from the bank highlighted the evaporating liquid supply as multi-billion dollar institutions and corporations are buying substantial quantities at a fast rate. “The demand for bitcoin is significantly higher than the actual supply and investors could put 1% of their portfolio in BTC,” JPMorgan advised. 

Bitcoin’s last halving which happened in May last year, saw the production rate of new Bitcoins slashed into two. The increasing demand that followed the halving, coupled with its decreasing liquid supply drove the price of the coin up as it has gained over 50% value since January 1.

The latest interest from institutions has further fueled the decreasing liquid supply as MicroStrategy Inc (NASDAQ: MSTR) now owns over 90,000 Bitcoin, with Tesla Inc (NASDAQ: TSLA) allocating $1.5 billion in the asset while Grayscale is purchasing new coins at record levels. 

JPM strategists Joyce Chang and Amy Ho in a note to clients stated that “in a multi-asset portfolio, investors can likely add up to 1% of their allocation to cryptocurrencies in order to achieve any efficiency gain in the overall risk-adjusted returns of the portfolio.”

Bitcoin’s insane bull run looks to have hit a wall as its value has seen a 20% decline since its all-time high of over $58,000 on February 21. JP Morgan’s latest comments have been met with criticisms as it contradicts earlier statements made by other strategists from the bank, which stated that “crypto assets should be treated as investment vehicles and not funding currencies such as USD or JPY.”

The bank also claimed that “crypto assets continue to rank as the poorest hedge for major drawdowns in equities,” but looks to have circled back on its words. 

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Crypto fanatic, writer and researcher. Thinks that Blockchain is second to a digital camera on the list of greatest inventions.



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World’s First Ethereum ETF on Pace to Be Launched by Canada’s CI GAM

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Canada’s openness to cryptocurrency innovation is in place and is billed to help bring live the supposed world’s first Ethereum ETF product.

Canada-based CI Global Asset Management (CI GAM) is on pace to launch the world’s first Ethereum (ETH) Exchange Traded Fund (ETF) product. The company revealed this in a press release, noting that it had filed and obtained a receipt for a preliminary prospectus for CI Galaxy Ethereum ETF which will trade under the ticker symbol “ETHX”.

An Ethereum-backed Exchange-Traded Fund is an investment vehicle that provides investors with the opportunity to venture into the ETH markets without the attendant risk of purchasing the asset itself. It offers corporate clients who have a vested interest in digital assets the opportunity to do so under a more regulated setting.

CI GAM is launching its ETHX product in conjunction with Galaxy Digital Capital Management LP (“Galaxy Digital”), a subsidiary of Galaxy Digital Holdings Ltd (TSX: GLXY) owned by Mike Novogratz. The latter firm will act as the Ether sub-advisor for the ETF giving it a direct involvement in trading the cryptocurrency on behalf of the outfit.

“Cryptocurrencies are transforming the financial world, and we are excited to launch the world’s first ETF investing directly in Ether, one of the most highly valued cryptocurrencies,” said Kurt MacAlpine, Chief Executive Officer of CI Financial, the parent company of CI GAM. “With these funds, we are reducing the friction points that investors have traditionally faced in buying and holding cryptocurrencies.”

ETHX as announced will be listed on the Toronto Stock Exchange with investments made directly in Ethereum. Per the press release, the fund’s holdings will be priced using the Bloomberg Galaxy Ethereum Index (“ETH Index”), a tool designed to measure the performance of a single Ether traded in U.S. dollars.

World’s First Ethereum ETF in View, Canada’s Openness at Play

Canada’s openness to cryptocurrency innovation is in place and is billed to help bring live the supposed world’s first Ethereum ETF product. Canada approved two Bitcoin ETFs this month, further strengthening the nation’s position to embrace digital currency offerings.

The backing for an Ethereum ETF is not out of place, the cryptocurrency is the second-largest by market capitalization and it is the flagship network for Web3.0.

“Ethereum is the leading candidate to be the base layer of Web 3.0, and Ether is a growth asset that provides investors exposure to the explosion of decentralized applications,” said Mike Novogratz, Chairman and Chief Executive Officer of Galaxy Digital Holdings.

The debut of the Ethereum ETF has lots of implications, with the core being a springboard for many more to emerge. These products may serve as the ultimate link to endear increased institutional investor participation into the volatile and largely unregulated world of cryptocurrencies.

“We are thrilled to expand our advisory relationship with CI,” said Steve Kurz, Partner, and Head of Asset Management. “The CI Galaxy Ethereum ETF represents a global first, giving investors a simplified path to benefit from the potential growth of this important asset class.”

Read more news of the crypto industry on Coinspeaker.

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Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.



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DeFi Exchange 1Inch Shifts to Binance Smart Chain due to High ETH Gas Fee

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With this, the 1INCH token will serve as a bridge between the Binance Smart Chain and the Ethereum blockchain. Also, all features of 1inch Liquidity Protocol, 1inch Aggregation Protocol and all 1INCH staking features will become available to BSC users.

The skyrocketing Ethereum gas fee has become a matter of concern for investors as well as DeFi platforms on the Ethereum blockchain. On Thursday, February 25, the decentralized finance (DeFi) platform 1inch said that it has deployed the 1inch token on the Binance Smart Chain (BSC).

Thus, the BSC users will not get access to the 1inch Liquidity Protocol. Also, the 1INCH token will serve as a bridge between the Binance and the Etheruem networks. Once the user sends the 1INCH token to BSC, it shall be locked in Binance Bridge. At the same time, it will unlock the corresponding value of 1INCH on Binance.

The official announcement notes that the 1INCH users will get access to DEX platforms like PancakeSwap, BurgerSwap, StreetSwap, Venus, StableSwap, JulSwap, BakerySwap and other Binance-based DEXes and lending protocols. The announcement further adds:

“Most recently, BSC has shown enormous activity, prompting the arrival of new promising DEXes. As we at 1inch are always on the lookout for the hottest DeFi projects, the addition of BSC-based DEXes to our aggregation protocol came as a natural step”.

Initially, DeFi platform 1INCH issued 10 million native tokens on BSC. As said, they will be now available as liquidity in Binance Bridge. Sergey Kunz, 1inch co-founder and CEO said:

“We see a significant opportunity for 1inch Liquidity Protocol to become the biggest liquidity protocol on Binance Smart Chain, as it’s already the most efficient AMM protocol in the market”.

1Inch Opts for Binance Smart Chain Because of ETH Gas Fee

Although the Ethereum blockchain captures a lion’s share in the DeFi space, the high DeFi activity has led to a surge in the average transaction fee. Earlier this week, the average Ethereum transaction fee spike to above $37, its highest in the six-year history.

Thus, DeFi players are moving now moving to the Binance Smart Chain (BSC). The BSC can handle nearly 10 time s the gas fee of the Ethereum blockchain. With the surge in the DeFi activity on BSC, the demand for Binance Coin (BNB) has shot up significantly.

The Binance Coin (BNB) has surged all its way to becoming the third-largest cryptocurrency by market cap. Last Saturday, the BNB price touched its all-time high of $337. However, it has corrected more than 20% since then during the marketwide correction. At press time, BNB is trading at a price of $229 with a market cap of $35.5 billion. Even at the current price, BNB is trading 500% up year-to-date.

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Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.





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