The Nasdaq-listed Valkyrie Bitcoin Mining ETF “WGMI” Has Been Approved
Valkyrie, a cryptocurrency asset management business, will debut a new exchange-traded fund (ETF) on the Nasdaq this week.
The stock market will list Valkyrie’s new ‘Bitcoin Mining ETF,’ an investment instrument that will give exposure to companies that derive at least 50% of their income or earnings from Bitcoin or crypto mining, or associated gear and software.
Spot Bitcoin and cryptocurrency ETFs have yet to enter the US market, impeded by the SEC’s cautious attitude toward such ETFs. However, the SEC has recently grown more receptive to the notion of futures ETFs, beginning with the ProShares ETF and VanEck Bitcoin ETF. October was a watershed month for public markets and cryptocurrency, with Valkyrie joining the ranks of ProShares, Invesco, and numerous other investing organisations in seeking crypto-focused exchange-traded funds.
Valkyrie’s newest ETF, ‘WGMI’ (a play on the popular crypto term “we’re going to make it”), will begin trading tomorrow, Tuesday, February 8th, at the Nasdaq’s opening bell. Valkyrie has determined that at least 80% of the ETF’s portfolio would be comprised of shares of companies that derive the bulk of their income or profit from crypto mining, or from hardware and/or software connected to crypto mining. The remaining 20% of the ETF’s net assets will be distributed to companies that hold “a substantial amount of their net assets” in Bitcoin and other cryptocurrencies. The ETF will have an expense ratio of 0.75 per cent.
What to Expect
WGMI is the third ETF to be approved by Valkyrie, after the firm’s wide Bitcoin futures ETF and “Balance Sheet Opportunities ETF,” which invests in companies that “directly or indirectly invest in, deal in, or otherwise have exposure to bitcoin.”
While we know that this new Valkyrie ETF will not own any crypto assets directly, we can anticipate some of the industry’s top mining brands to be included, including Hive, Bitfarms, Marathon, and more. With 20% allotted to enterprises with significant net assets in Bitcoin, we might potentially see MicroStrategy and other key players join the WGMI. Additionally, the fund said that its assets use almost 77 per cent renewable energy, which is more than twice the average for publicly listed firms.