Coinbase is currently seen as the Dow Jones of cryptocurrencies because of their recent launch of a cryptocurrency index fund which marks the first step for Coinbase towards asset management.
As the largest cryptocurrency company in the world that is valued at $1.6 billion, Coinbase has formed a subsidiary called Coinbase Asset Management in order to oversee the new Coinbase Index Fund. The new fund will allow investors to see all of Coinbase’s assets listed on the institutional exchange, GDAX, market capitalizations etc. Every time a new asset is listed – it will be automatically added to the fund.
As the main product lead, Reuben Bramanathan told Reuters, “We’re seeing strong demand from our customers and the market generally for a passive investment management product,”. He also noted that for now, the index fund will be available only to US resident investors and will cover a broader range of digital assets.
What’s interesting is that this new fund will also track the Coinbase Index that will be launched as well. The idea here is simple – to benchmark the performance of all assets listed on Coinbase as well as the digital currencies including Bitcoin, Bitcoin Cash, Ethereum and Litecoin.
https://www.twitter.com/coinbase/status/971156625951145985
According to Bramanathan, most of the cryptocurrency funds out there are actively managed ones. However, there is a big demand for index funds that will allow investors to track the performance of an entire asset class – compared to picking a winner in a list.
Some earlier reports say that Coinbase told its shareholders that it posted a revenue of $1 billion in 2017. With the new cryptocurrency index fund, everyone expects this number to (at least) double.
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