The new BITC ETF will use an “optimum roll” strategy to focus on long-term returns for investors.
Bitwise Asset Management, Creators of the Bitwise Crypto Industry Innovators ETF and Bitwise Web3 ETF, have introduced a new “Bitwise Bitcoin Strategy Optimum Roll ETF” under the ticker BITC.
According to the press release, the fund “was built to offer investors regulated, professionally managed exposure to bitcoin with a unique design that minimizes pricing inefficiencies that can emerge in bitcoin-linked ETFs focused on front-month or near-month futures contracts.” The ETF aims to address this by utilizing what it describes as an “optimum roll strategy that considers all available contracts and intelligently selects the contracts with the lowest level of contango (or the highest level of backwardation) in an effort to maximize long-term returns.”
Bitwise CIO Matt Hougan explained why this particular structure was chosen.
“Historically, optimum roll strategies in other asset classes, such as oil and natural gas futures, have outperformed strategies focused on front-month or near-month contracts over time,” he said. “We believe this same strategy can apply to the bitcoin futures market as it continues to deepen and evolve.”
In addition, the fund’s structure as an SEC-regulated ETF will make bitcoin exposure available in a format “overwhelmingly favored by financial professionals,” according to the press release, citing research by Bitwise and VettaFi exploring financial advisor attitudes toward crypto that found ETFs were the preferred method of investing for 68% of advisors.
“If there’s anything this past year has reinforced, it's that how you invest in crypto is as important as what you invest in,” Bitwise CEO Hunter Horsley reiterated. “The Bitwise Bitcoin Strategy Optimum Roll ETF gives institutions, advisors, and their clients a professional, regulated solution for adding exposure to bitcoin returns while bypassing the risks of custodying bitcoin directly or investing through novel platforms.”
The custodian of the BITC ETF is BNY Mellon and the fund’s distributor is Foreside Fund Services, LLC.
It should be noted that holding Bitcoin futures ETFs does introduce third-party risk not present for those who hold spot bitcoin in self-custody wallets.
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