21Shares and ByteTree Launch The World’s First-Ever Bitcoin and Gold ETP

21Shares And ByteTree

Welcome back to the Tribe! In this post we dive into 21Shares and ByteTree launching the world’s first Bitcoin and Gold ETF

Nothing should be considered investment or financial advice. Enjoy the ride!

21Shares And ByteTree

The first-ever Bitcoin x Gold exchange-traded product was launched by a collaboration between ETP issuer 21 Shares and ByteTree, an asset management heavyweight. Dubbed BOLD, the fund will debut on the Swiss exchange SIX. BOLD is split with an 18.5% BTC and an 81.5% Gold sharing formula. An algorithm that leverages 360-day historical volatility data will rebalance the fund on a monthly basis.

It’s a moment for the history books as this is the first fund combining traditional gold and the so-called digital gold..

BOLD ETP Merges Gold And Bitcoin Into Single Product

Financial Times reported that an exchange-traded product made of Bitcoin and Gold was launched on the SIX Swiss Exchange on Wednesday (April 27, 2022).

According to the report, the fund with the ticker BOLD was developed by popular ETP Issuer 21 Shares and Digital Asset Manager ByteTree. The unorthodox combination of Gold and Bitcoin is the first of its kind. 21 Shares also confirmed the news via a tweet on Wednesday:

Once again, @21Shares builds bridges between traditional finance & #crypto by launching BOLD together with ByteTree AM! This ETP comprises bitcoin and gold, and rebalances monthly according to the inverse historic volatility of each asset. Details:
👉 https://t.co/rk2qu2bBAU pic.twitter.com/FxwVpEYk0N

— 21Shares (@21Shares) April 27, 2022

“Once again, @21Shares builds bridges between traditional finance & #crypto by launching BOLD together with ByteTree AM! This ETP comprises bitcoin and gold and rebalances monthly according to the inverse historic volatility of each asset. ”

Details about BOLD revealed that the fund is made up of around 81.5% Gold and 18.5% of the world’s leading cryptocurrency.

Furthermore, the ETP is supposedly designed as an anti-inflationary fund geared toward providing investors with a product to hedge against rising rates.

Indeed, BOLD hopes to deliver on its promises by deploying a monthly rebalancing mechanism to optimize returns. The mechanism will use data from 360-day historical volatility patterns according to Charlie Morris, the Chief Investment Officer at ByteTree.

Morris explained that this method has been tested by the digital asset management giant and the results were promising. Leveraging the rebalancing algorithm supposedly delivered bolstered returns between 7%-9% and also allowed BOLD to tackle extreme volatility.

The Investment Officer opined that:

“Gold’s volatility is now lower than Nasdaq, but the yellow metal has offered better returns than tech stocks. So, bitcoin is likely to outperform Nasdaq in both bull and bear markets”

Finally, Morris highlighted the rationale behind deploying an ETP that features a traditional financial asset and a cryptocurrency.

“We are making bitcoin an acceptable asset to hold and bringing gold into the 21st century. It struck me that bitcoin and gold were always countercyclical. It’s obvious to me that bitcoin has always been correlated to the stock market, or to risk assets in general.”

Investors have supposedly shown an increased appetite for ETPs and Exchange-traded Funds (ETFs) in recent months. Data from ETF.com shows that over 30 funds have been launched in 2022 alone.

Despite the surge in demand, America’s SEC remains opposed to Bitcoin Spot ETF citing volatility and market manipulation concerns. However, Grayscale’s Michael Sonnenshein has surmised that the SEC cannot withhold approval forever.

Other News – Fidelity Plans To Support Bitcoin

Fidelity expands its offerings with a Crypto retirement product. American employers can designate a portion from their 401K retirement accounts to Bitcoin. Fidelity will implement a 20% allocation cap for this option.