The cryptocurrency asset manager Hashdex is preparing to liquidate its spot bitcoin exchange-traded fund, marking a potentially significant event within the U.S. market for such offerings. The decision stems from decreased investor interest in the fund and an assessment of its performance as part of the company’s broader product portfolio.
As of today, the Hashdex Bitcoin ETF holds approximately $14.7 million in assets under management, currently valued at $64,550.30. This makes it the smallest U.S. spot bitcoin ETF by net assets. The liquidation process is expected to conclude following a review of its standing within Hashdex’s operational strategy.
The move follows the approval of spot bitcoin ETFs in January 2024. Concurrent with this development, K33 Research published a report in June 2024 examining market views on Bitcoin investment opportunities. Head of K33 Research, Vetle Lunde, reportedly stated that “much of the market views the opportunity cost of holding BTC as too high while anything AI-related soars.”
Simultaneously, BlackRock has seen success with its iShares Future AI & Tech ETF, gaining 39% through July. This demonstrates a shift in investor appetite towards artificial intelligence-focused assets. The ETF currently holds $3.6 billion in assets.
The broader cryptocurrency market has experienced challenges recently, with the CoinDesk 20 (CD20) Index reflecting a 36% decline based on current data. Other major bitcoin ETFs, including those managed by BlackRock ($47.08 billion) and WisdomTree ($142.4 million), are also impacted by this downward trend.
Data from SoSoValue suggests continued flows into AI-related investments as opposed to Bitcoin. This highlights a divergence in investor sentiment across different sectors of the digital asset market.
The liquidation will conclude the operation of the Hashdex Bitcoin ETF (DEFI). It is currently unclear on the precise timeline for the process or the ultimate destination of the assets held within the fund.
Written by Oliver Grant
Markets Desk
