Crypto Asset Manager Bitwise Launches World’s First NFT Index Fund

In an announcement on Dec. 16, Bitwise chief information officer Matt Hougan unveiled the launch of the Bitwise Blue-Chip NFT Index Fund in what he claimed was the world’s first.

He added that the fund, which rebalances every three months, would hold the ten most valuable NFT collections, including CryptoPunks, Bored Ape Yacht Club, Meebits, Autoglyphs, Fidenza, VeeFriends, and more. The index selects and weights NFTs based on their market capitalization using what it called “floor prices.”

Bitwise explained that its “Adjusted Floor Price” is designed to reflect the “price at which an investor can buy or sell the lowest-price NFT in any given collection.”

1/ Today we’re launching the Bitwise Blue-Chip NFT Index Fund, the world’s 1st NFT index fund.

NFTs are a historic movement, and just getting started.

The fund holds the 10 most valuable NFT collections: CryptoPunks, Bored Apes, Fidenza, etc.

A thread w more details — pic.twitter.com/4UyipQorrZ

— Matt Hougan (@Matt_Hougan) December 16, 2021

NFT Exposure for Investors

Hougan added that NFTs with fewer than 100 items in the collection or 1:1 single releases are too illiquid for inclusion. It will focus on music rights, virtual land, game items, and arts and collectibles.

Hougan stated that the fund’s minimum investment is $25,000, lower than many blue-chip NFTs. It is only available to accredited U.S. investors, however. He stated that the goal is to “make owning the blue-chip NFTs emerging in this historic new category simpler,” before adding:

“New frontiers in art are rare. Entirely new artistic mediums are even rarer. NFTs have emerged as the first digitally native medium for owning art and collectibles, with enormous potential for meaning, value, and use in our increasingly digital world.”

In addition to the Blue-Chip NFT Index Fund, Bitwise has created eight other crypto funds this year. Four were index-based, such as the Bitwise DeFi Index Fund and the Bitwise “ex Bitcoin” Index Fund.

In October, the firm launched the Bitwise Polygon (MATIC) Fund, providing exposure to the layer 2 scaling network. Bitwise also has funds for Compound Finance, Ethereum, and Uniswap. The company has more than $1.6 billion in assets under management.

NFT Market Outlook

According to data from Nonfungible.com, there has been $253 million in NFT sales volume over the past week, with almost 90,000 items sold.

Cryptoslam, which ranks collections by sales volume, is reporting that Axie Infinity has been knocked off the top spot for weekly sales. It has been replaced by the CloneX collection, which has seen $135 million in volume over the past seven days.