First Crypto ETF Index Fund launched!!! $HODL

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AndroAsc
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First Crypto ETF Index Fund launched!!! $HODL

Post by AndroAsc »

First ETF for cryto aka "bitcoin" was released in Switzerland under $HODL. Finally!!!

Basically, it looks like a crypto index fund that tracks the largest 5 crypto and rebalance based on market cap. I'm thinking of using my play money which is currently in "alternative assets" (aka commodities, timber, gold, whatever new flavor, etc.) for this.

Thoughts? Comments? Also on the practicality of setting this up... how do I buy an ETF on the Swiss stock exchange?
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LiveSimple
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by LiveSimple »

Enjoy, if you have money to put in a new fad 😂
bargainhuntingking
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by bargainhuntingking »

Sounds like the Bitwise mutual fund which holds the top 10 cyptos as a % of market cap. Bitwise is a "market cap" crypto fund but since Bitcoin is such a large percentage of the cap, most of the other "alt coin" crypto are insignificant in terms of their effect on the overall fund performance. Why not just buy bitcoin directly (through Coinbase) and avoid the expense ratio? Get ready for a rollercoaster. It might be more enjoyable to just dump your money in a trashcan. I stopped speculating in 2014 after watching price fluctuations ranging from $90-1200/btc with scandal after scandal plaguing adoption, security, confiscation etc. Also, mainstream adoption never took off. It seemed like the big hoarding "whales" were pumping and dumping and massively manipulating the price of btc. I cashed out with a 5 figure loss and tax loss harvested. Yes, I was one of the few people who reported my transactions to the IRS on my 2014 return (perhaps only a couple dozen others did the same?). I put the rest of my "speculative" play money in a total stock US fund and never looked back. Good riddance!
Last edited by bargainhuntingking on Tue Nov 27, 2018 10:00 pm, edited 2 times in total.
saintsfan342000
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by saintsfan342000 »

Hopefully this means that regulators will soon approve that ETF that tracks my performance at the craps table.
Already impartial now
Topic Author
AndroAsc
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by AndroAsc »

bargainhuntingking wrote: Tue Nov 27, 2018 9:22 pm Sounds like the Bitwise mutual fund which holds the top 10 cyptos as a % of market cap. Bitwise is a "market cap" crypto fund but since Bitcoin is such a large percentage of the cap, most of the other "alt coin" crypto are insignificant in terms of their effect on the overall fund performance. Why not just buy bitcoin directly (through Coinbase) and avoid the expense ratio? Get ready for a rollercoaster. It might be more enjoyable to just dump your money in a trashcan. I stopped speculating in 2014 after watching price fluctuations ranging from $90-1200/btc with scandal after scandal plaguing adoption, security, confiscation etc. Also, mainstream adoption never took off. It seemed like the big hoarding "whales" were pumping and dumping and massively manipulating the price of btc. I cashed out with a 5 figure loss and tax lost harvested. Yes, I was one of the few people who reported my transactions to the IRS on my 2014 return (perhaps only a couple dozen others did the same?). I put the rest of my "speculative" play money in a total stock US fund and never looked back. Good riddance!
Many reasons, it's a market-cap weight crypto fund. I have no time to rebalance, which is prob very frequent given how volatile crypto is. Also, I don't want to deal with hackers and security issues and risk all my money being drained away.

This is also not speculation. It's buy-and-hold. Like for decades... hence needed a somewhat diversified crypto fund as opposed to just BTC.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by AlphaLess »

Just in time to sell to uninformed retail investors.
Yeay!

They missed it by a year, though. They could have sold it at even more astronomical prices: 6x todays value.
Here is to another phenomenal year to cryptos: may the next year be as good as the previous one!
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by aristotelian »

AndroAsc wrote: Tue Nov 27, 2018 9:27 pm
This is also not speculation. It's buy-and-hold. Like for decades... hence needed a somewhat diversified crypto fund as opposed to just BTC.
Up to you of course, but what is your decision rule for rebalancing? If it goes up, at what point will you sell back to your allocation? If it goes to zero, will you buy more? You may have every intention of buy and hold, but I am guessing speculation will rear its ugly head.
columbia
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by columbia »

Has anyone calculated its correlation with QSPIX? ;)
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by Northern Flicker »

This is also not speculation. It's buy-and-hold. Like for decades... hence needed a somewhat diversified crypto fund as opposed to just BTC.
That assumes it will be around for decades.
Risk is not a guarantor of return.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by nisiprius »

AndroAsc wrote: Tue Nov 27, 2018 9:08 pmFirst ETF for cryto aka "bitcoin" was released in Switzerland under $HODL. Finally!!!

Basically, it looks like a crypto index fund that tracks the largest 5 crypto and rebalance based on market cap. I'm thinking of using my play money which is currently in "alternative assets" (aka commodities, timber, gold, whatever new flavor, etc.) for this.

Thoughts? Comments? Also on the practicality of setting this up... how do I buy an ETF on the Swiss stock exchange?
I strongly suspect "ETF" is a misnomer. But oddly (?) I can't find a prospectus for the product, can you?

It's weird, actually. A Google search on Amun Crypto hodl etf prospectus turns up nothing but news stories, in the cryptocurrency press, many not mentioning the prospectus and none linking to it.


OK, found it, sorry.

Amun Crypto Index Basket, Ticker HODL
Factsheet

I was right. It's not an ETF.

AndroAsc, you don't say where you live, but the factsheet says, in all caps:
NOT FOR DISTRIBUTION TO ANY U.S. PERSON OR TO ANY PERSON OR ADDRESS IN THE UNITED STATES.
That's also the first sentence in the prospectus.
Last edited by nisiprius on Tue Nov 27, 2018 10:04 pm, edited 5 times in total.
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rkhusky
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by rkhusky »

AndroAsc wrote: Tue Nov 27, 2018 9:27 pm This is also not speculation. It's buy-and-hold. Like for decades.
Buy and hold is not mutually exclusive with speculation. I could buy Beanie Babies and hold them for 30 years and it would still be speculation.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by Nate79 »

rkhusky wrote: Tue Nov 27, 2018 9:54 pm
AndroAsc wrote: Tue Nov 27, 2018 9:27 pm This is also not speculation. It's buy-and-hold. Like for decades.
Buy and hold is not mutually exclusive with speculation. I could buy Beanie Babies and hold them for 30 years and it would still be speculation.
Agreed.

Bitcoin and other cryptos are the epitome of speculation.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by ThePrince »

AndroAsc wrote: Tue Nov 27, 2018 9:08 pm First ETF for cryto aka "bitcoin" was released in Switzerland under $HODL. Finally!!!

Basically, it looks like a crypto index fund that tracks the largest 5 crypto and rebalance based on market cap. I'm thinking of using my play money which is currently in "alternative assets" (aka commodities, timber, gold, whatever new flavor, etc.) for this.

Thoughts? Comments? Also on the practicality of setting this up... how do I buy an ETF on the Swiss stock exchange?
How about you go ahead and light that money on fire? Better to get it over with quickly and move on.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by oldzey »

Can you buy marijuana with cryptocurrency? Just sayin'...
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by nisiprius »

The prospectus says, among other things (there appear to be about forty pages devoted to nothing but disclosure of risks):
General Insolvency Risk – Each Investor bears the general risk that the financial situation of the Issuer could deteriorate. Unless specified otherwise, Investors are exposed to the credit risk of the Issuer of the Products. Products in each Series constitute unsubordinated obligations of the Issuer and rank pari passu with each other and all other current and future unsubordinated obligations of the Issuer. The insolvency of the Issuer may lead to a partial or total loss of the invested capital....

No Regulation of the Issuer – The Issuer is not required to be licensed, registered or authorised under any current securities, commodities or banking laws of its jurisdiction of incorporation and will operate without supervision by any authority in any jurisdiction. There can be no assurance, however, that regulatory authorities in one or more other jurisdictions will not determine that the Issuer is required to be licensed, registered or authorised under the securities, commodities or banking laws of such jurisdiction or that legal or regulatory requirements with respect thereto will not change in the future. Any such requirement or change could have an adverse impact on the Issuer or Investors in the Products....

Counterparty Risk - The Issuer will be exposed to the credit risk of a number of counterparties with whom the Issuer transacts, including, but not limited to, the Custodian, the Administrator, Wallet Provider(s), Depositaries, Paying Agents, Market Makers, Authorised Participants and exchanges. Consequently, the Issuer is exposed to risks, including credit risk, reputational risk and settlement risk, arising from the failure of any of its counterparties to fulfil their respective obligations, which, if any such risks occur, may have a material adverse effect on the Issuer’s business and financial position.
So tell us, AndroAsc: what do you know about the financial soundness of Amun Crypto?
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by calmaniac »

AndroAsc wrote: Tue Nov 27, 2018 9:27 pm This is also not speculation. It's buy-and-hold. Like for decades... hence needed a somewhat diversified crypto fund as opposed to just BTC.
AndroAsc, I'm sorry you are too young and missed the dotcom bubble. Hopefully your crypto experience is better than my "buy and hold" with JDS Uniphase, Level 3, Ballard Power Systems, Excite and other detritus from that era. Although those >95% losses did teach me a lot!!! ROFL!!!
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by typical.investor »

AndroAsc wrote: Tue Nov 27, 2018 9:27 pm
bargainhuntingking wrote: Tue Nov 27, 2018 9:22 pm Sounds like the Bitwise mutual fund which holds the top 10 cyptos as a % of market cap. Bitwise is a "market cap" crypto fund but since Bitcoin is such a large percentage of the cap, most of the other "alt coin" crypto are insignificant in terms of their effect on the overall fund performance. Why not just buy bitcoin directly (through Coinbase) and avoid the expense ratio? Get ready for a rollercoaster. It might be more enjoyable to just dump your money in a trashcan. I stopped speculating in 2014 after watching price fluctuations ranging from $90-1200/btc with scandal after scandal plaguing adoption, security, confiscation etc. Also, mainstream adoption never took off. It seemed like the big hoarding "whales" were pumping and dumping and massively manipulating the price of btc. I cashed out with a 5 figure loss and tax lost harvested. Yes, I was one of the few people who reported my transactions to the IRS on my 2014 return (perhaps only a couple dozen others did the same?). I put the rest of my "speculative" play money in a total stock US fund and never looked back. Good riddance!
Many reasons, it's a market-cap weight crypto fund. I have no time to rebalance, which is prob very frequent given how volatile crypto is. Also, I don't want to deal with hackers and security issues and risk all my money being drained away.

This is also not speculation. It's buy-and-hold. Like for decades... hence needed a somewhat diversified crypto fund as opposed to just BTC.
Decades? OK, please explain any hard fork mechanisms in the prospectus.

Previous ETF attempts were criticized for their handling.

I point out that this has already happened to bitcoin twice, and if coins split there is the possibility of losing value if the ETF doesn't invest in both chains.

If you don't understand this, and can't explain how it's resolved, you are breaking the basic rule of not investing in anything you don't understand.

Also, I don't believe an ETF solves security issues.
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Random Musings
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by Random Musings »

Under what asset class does this fall under?

None.

Is this the final marketing push to make it more accessible to a larger group of suckers?

RM
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by drk »

oldzey wrote: Tue Nov 27, 2018 9:57 pm Can you buy marijuana with cryptocurrency? Just sayin'...
Sure, but why bother when I can buy it with US dollars?
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by typical.investor »

typical.investor wrote: Tue Nov 27, 2018 10:55 pm
AndroAsc wrote: Tue Nov 27, 2018 9:27 pm
bargainhuntingking wrote: Tue Nov 27, 2018 9:22 pm Sounds like the Bitwise mutual fund which holds the top 10 cyptos as a % of market cap. Bitwise is a "market cap" crypto fund but since Bitcoin is such a large percentage of the cap, most of the other "alt coin" crypto are insignificant in terms of their effect on the overall fund performance. Why not just buy bitcoin directly (through Coinbase) and avoid the expense ratio? Get ready for a rollercoaster. It might be more enjoyable to just dump your money in a trashcan. I stopped speculating in 2014 after watching price fluctuations ranging from $90-1200/btc with scandal after scandal plaguing adoption, security, confiscation etc. Also, mainstream adoption never took off. It seemed like the big hoarding "whales" were pumping and dumping and massively manipulating the price of btc. I cashed out with a 5 figure loss and tax lost harvested. Yes, I was one of the few people who reported my transactions to the IRS on my 2014 return (perhaps only a couple dozen others did the same?). I put the rest of my "speculative" play money in a total stock US fund and never looked back. Good riddance!
Many reasons, it's a market-cap weight crypto fund. I have no time to rebalance, which is prob very frequent given how volatile crypto is. Also, I don't want to deal with hackers and security issues and risk all my money being drained away.

This is also not speculation. It's buy-and-hold. Like for decades... hence needed a somewhat diversified crypto fund as opposed to just BTC.
Decades? OK, please explain any hard fork mechanisms in the prospectus.

Previous ETF attempts were criticized for their handling.

I point out that this has already happened to bitcoin twice, and if coins split there is the possibility of losing value if the ETF doesn't invest in both chains.

If you don't understand this, and can't explain how it's resolved, you are breaking the basic rule of not investing in anything you don't understand.

Also, I don't believe an ETF solves security issues.
Really. Please explain why the fork provisions in the prospectus don't mean that this is not a suitable investment vehicle!

We just saw a fork and both chains retained value. The prospectus says you don't have any right to the value of the forked chains. It's a material risk and clearly stated as so. It's happened to bitcoin twice already now. Any you are going to hold it for decades?

I think people would be nuts for using the ETF instead of holding the cryptos directly. You are giving up rights by using the ETF that very well may come back to haunt you.
Fork Policy Risk & Risks Associated with Newly-Forked Assets
Investors should be aware that investing in this Product is not equivalent to investing directly in Crypto Assets. The Investor does not have a claim to any forked assets. The Issuer may elect to support a fork based on predetermined criteria, but is under no obligation to do so. Unless otherwise announced, the Issuer will not support the inclusion of any forked assets.
Unless an announcement is made informing Investors that a fork will be supported, the newly-forked asset should be considered ineligible. Given the nature of forks and the frequency of forks in the Underlying, the Issuer does not expect to assess every Fork Event. Only Fork Events deemed material by the Issuer will be considered for evaluation.
The analysis regarding whether to support a fork is the sole discretion of the Issuer. These considerations include, but are not limited to, availability of a custody solution, trading support from Authorised Participants and/or Market Makers, sufficient liquidity and the availability of a price on the date of the fork. While these attributes may change over time, the Issuer requires that any forked asset have an available custody and trading solution on the fork date.
These policies may result in the exclusion of a forked asset, which may have considerable value. There is no recourse for Investors to access that value if the fork is deemed to be unsupported.
The assessment of whether to support a fork or not is based on a specific point-in-time set of criteria. The newly- forked asset may meet the Issuer’s eligibility criteria at a later date. This change in status does not constitute a reversal of the previous assessment. Investors should not expect the Issuer to retrieve any previously allocated forked assets after the fork date even if the underlying become eligible.
Newly-forked assets in particular may have less liquidity than more established assets, resulting in a greater risk. Inclusion of a newly-forked asset may increase other risks included herein, such as liquidity risk, market manipulation risk, risk of bankruptcy or insolvency and increased volatility, among others.
The circumstances of each fork are unique and their relative significance varies. It is possible that a particular fork may result in a significant disruption to the underlying asset and, potentially, may result in a Market Disruption Event should pricing become problematic following the fork. It is not possible to predict with accuracy the impact that any anticipated fork could have for how long any resulting disruption may exist. Moreover, a newly-forked asset may have a higher risk profile due to (i) increased operational risks, such as lack of IT-infrastructure to cater for the new Crypto Asset, (ii) increased market risks as a result of lower liquidity in the newly-forked asset (resulting from lower participation), which may, in turn, lead to significant price suppression and increased volatility; and (iii) additional, asset specific risks which are not included in this Base Prospectus..
Summary

Forks can and do happen. You have no right to forked assets. Even if the fund invests in those forked assets at a later date (when they are more stable), you may have to buy back the forked assets you lost. The fund will will not recover them for you. You have no recourse. Of course, the fund at its discretion may support the fork, but what if they instead are able to keep the forked assets for themselves?

Sound investment vehicle? Please.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by WanderingDoc »

AndroAsc wrote: Tue Nov 27, 2018 9:08 pm First ETF for cryto aka "bitcoin" was released in Switzerland under $HODL. Finally!!!

Basically, it looks like a crypto index fund that tracks the largest 5 crypto and rebalance based on market cap. I'm thinking of using my play money which is currently in "alternative assets" (aka commodities, timber, gold, whatever new flavor, etc.) for this.

Thoughts? Comments? Also on the practicality of setting this up... how do I buy an ETF on the Swiss stock exchange?
#HODL
#HODLto$0
#HODLgang
:P
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by nisiprius »

typical.investor wrote: Tue Nov 27, 2018 11:12 pm...Really. Please explain why the fork provisions in the prospectus don't mean that this is not a suitable investment vehicle!

We just saw a fork and both chains retained value. The prospectus says you don't have any right to the value of the forked chains. It's a material risk and clearly stated as so. It's happened to bitcoin twice already now. Any you are going to hold it for decades?

I think people would be nuts for using the ETF instead of holding the cryptos directly. You are giving up rights by using the ETF that very well may come back to haunt you.
Fork Policy Risk & Risks Associated with Newly-Forked Assets
Investors should be aware that investing in this Product is not equivalent to investing directly in Crypto Assets. The Investor does not have a claim to any forked assets. The Issuer may elect to support a fork based on predetermined criteria, but is under no obligation to do so. Unless otherwise announced, the Issuer will not support the inclusion of any forked assets.

Unless an announcement is made informing Investors that a fork will be supported, the newly-forked asset should be considered ineligible. Given the nature of forks and the frequency of forks in the Underlying, the Issuer does not expect to assess every Fork Event. Only Fork Events deemed material by the Issuer will be considered for evaluation.

The analysis regarding whether to support a fork is the sole discretion of the Issuer...
These policies may result in the exclusion of a forked asset, which may have considerable value. There is no recourse for Investors to access that value if the fork is deemed to be unsupported.
Holy cow. Combine that with "No Regulation of the Issuer – The Issuer is not required to be licensed, registered or authorised under any current securities, commodities or banking laws of its jurisdiction of incorporation and will operate without supervision by any authority in any jurisdiction."
Last edited by nisiprius on Thu Nov 29, 2018 6:16 am, edited 1 time in total.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by bawr »

The whole point of Bitcoin is that you can be your own bank. There is no need for intermediaries.

People who wish to hold bitcoins, or if they insist, other tokens, should hold them directly. Individuals don't need instruments like HODL or GBTC.

Remember:

Your private keys = Your coins.

Not your private keys = Not your coins.
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nisiprius
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by nisiprius »

bawr wrote: Thu Nov 29, 2018 4:05 am The whole point of Bitcoin is that you can be your own bank. There is no need for intermediaries.

People who wish to hold bitcoins, or if they insist, other tokens, should hold them directly. Individuals don't need instruments like HODL or GBTC.

Remember:

Your private keys = Your coins.

Not your private keys = Not your coins.
From reading what bitcoin advocates say, I get the distinct impression that there is a balance of risk factors and safety factors involved in holding your own bitcoin in a personal software wallet, versus having an institution ("exchange," ETP, etc.) hold them for you with you as the beneficial owner.

I've read that about 20% of all bitcoin has been permanently lost. That suggests that "being your own bank" for bitcoin has much the same dangers as "being your own bank" for physical currency... worse, because even if your heirs, for example, find your bitcoin, they may not be able to do anything with it. I think there are also some big tax complications if you directly own a cryptocurrency and it undergoes a "hard fork," which you would not incur if you are holding an exchanged-traded product that in turn owns the bitcoin?

Bitcoin has two aspects. It is said to be "a currency" useful for actual transactions. If this were true, holding personal bitcoins personally in a wallet would be a good idea. As best I can tell from what I read and see, this is not really true. All of the publicity about "places you can spend bitcoin" is either the enthusiasm of hobbyists. In 1978 magazines were full of stories people using "computers"--with 16K of RAM and no storage but a cassette drive--"in their business." Either that, or it is all a fig leaf and a cover story. People aren't using bitcoin as a convenient way to buy Christmas gifts from overstock.com. If anything, we are seeing fewer and fewer stories about using bitcoin to buy sandwiches at Subway. The so-called "bitcoin ATM" at the big Boston train station is long gone.

The second aspect is speculative. To profit, in some way, from bitcoin going up. (If it is). Maybe it's an authentic gain of value from the creation of a new and useful technology--it's not really good for buying sandwiches at Subway today, but just you wait. Maybe it's a pyramid club whose whole purpose has always been to enrich some participants at the expense of others. In any case, you might say "I couldn't care less about whether it's really good for anything, all I know is that people think it is, it's going up. Based on the technical analysis reports I read on the bitcoin sites and the vibes I get as an informed participant in bitcoin forums, I'm sure it's going up. Someone is making money on this. I want it to be me." In that case, obviously, something like an ETP gives you a way to profit from the up-ness, even if it doesn't wire you in to the spirit of Satoshi--even if it makes you a parasite rather than a participant.

There are, then, three things to look at in this ETP. Well, four.

0) Can an investor in my country buy it? For the US, the answer seems to be "no," so, for a US investor, why even care?

1) Are the cryptocurrencies it invests in going to keep going up? Short-term, long-term, whatever? Fun to debate, but not by any means the biggest issue.

2) Does this really give me something close to full participation, or like phony "fixed indexed annuities" that claim to be linked to the stock market, or like so many "innovative" commodity "ETFs," will buyers find, sadly, that when bitcoin does go up, their ETP--for mysterious, technical, all-disclosed-in-the-prospectus reasons--doesn't go up? Or not nearly as much? (Much weeping and wailing a few years ago when people bought oil "ETFs" because they were sure the price of oil would go up, and they were right--the price of oil went up, but the price of the "ETF" didn't.)

3) Is this thing honest, or could it possibly be a scam, or partly a scam? If it's a scam, what protection do I have? Seemingly, the answer is "your only 'protection' is that the prospectus was required to disclose the fact that you have no protection."
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by aristotelian »

You gotta love a good ticker symbol. Ticker humor is not enough to get me to buy it, though.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by Valuethinker »

calmaniac wrote: Tue Nov 27, 2018 10:26 pm
AndroAsc wrote: Tue Nov 27, 2018 9:27 pm This is also not speculation. It's buy-and-hold. Like for decades... hence needed a somewhat diversified crypto fund as opposed to just BTC.
AndroAsc, I'm sorry you are too young and missed the dotcom bubble. Hopefully your crypto experience is better than my "buy and hold" with JDS Uniphase, Level 3, Ballard Power Systems, Excite and other detritus from that era. Although those >95% losses did teach me a lot!!! ROFL!!!
Bet you I lost more than you did ;-).

It was in my employer's stock, granted. But yes, hold on and it shall recover ;-).
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by Valuethinker »

nisiprius wrote: Tue Nov 27, 2018 9:50 pm
AndroAsc wrote: Tue Nov 27, 2018 9:08 pmFirst ETF for cryto aka "bitcoin" was released in Switzerland under $HODL. Finally!!!

Basically, it looks like a crypto index fund that tracks the largest 5 crypto and rebalance based on market cap. I'm thinking of using my play money which is currently in "alternative assets" (aka commodities, timber, gold, whatever new flavor, etc.) for this.

Thoughts? Comments? Also on the practicality of setting this up... how do I buy an ETF on the Swiss stock exchange?
I strongly suspect "ETF" is a misnomer. But oddly (?) I can't find a prospectus for the product, can you?

It's weird, actually. A Google search on Amun Crypto hodl etf prospectus turns up nothing but news stories, in the cryptocurrency press, many not mentioning the prospectus and none linking to it.


OK, found it, sorry.

Amun Crypto Index Basket, Ticker HODL
Factsheet

I was right. It's not an ETF.

AndroAsc, you don't say where you live, but the factsheet says, in all caps:
NOT FOR DISTRIBUTION TO ANY U.S. PERSON OR TO ANY PERSON OR ADDRESS IN THE UNITED STATES.
That's also the first sentence in the prospectus.
I cannot manage to cut and paste from the "prospectus" even though I am permitted to read it (as a non US-ian ;-)).

BUT what it does say is that the Prospectus is not a prospectus in the meaning of the EU Prospectus directive. I guess that's to rule out the protections a member of the EU would have (Switzerland is not in the EU but a broader federation with the EU).

But it did rather send a chill down the spine -- the prospectus that is not a prospectus ...
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by White Coat Investor »

The whole thing is just a big joke, even the name of the ETF. I feel badly for anyone putting serious money into the entire asset class.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by Nicolas »

White Coat Investor wrote: Thu Nov 29, 2018 11:31 am The whole thing is just a big joke, even the name of the ETF. I feel badly for anyone putting serious money into the entire asset class.
What is the joke with the ticker? It’s probably obvious but I don’t get it.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by BigMoneyNoWhammies »

AndroAsc wrote: Tue Nov 27, 2018 9:08 pm First ETF for cryto aka "bitcoin" was released in Switzerland under $HODL. Finally!!!

Basically, it looks like a crypto index fund that tracks the largest 5 crypto and rebalance based on market cap. I'm thinking of using my play money which is currently in "alternative assets" (aka commodities, timber, gold, whatever new flavor, etc.) for this.

Thoughts? Comments? Also on the practicality of setting this up... how do I buy an ETF on the Swiss stock exchange?
Hard pass
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by jminv »

Nicolas wrote: Thu Nov 29, 2018 11:42 am
White Coat Investor wrote: Thu Nov 29, 2018 11:31 am The whole thing is just a big joke, even the name of the ETF. I feel badly for anyone putting serious money into the entire asset class.
What is the joke with the ticker? It’s probably obvious but I don’t get it.
https://en.wikipedia.org/wiki/Hodl
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by nisiprius »

Valuethinker wrote: Thu Nov 29, 2018 11:25 am...BUT what it does say is that the Prospectus is not a prospectus in the meaning of the EU Prospectus directive. I guess that's to rule out the protections a member of the EU would have (Switzerland is not in the EU but a broader federation with the EU).

But it did rather send a chill down the spine -- the prospectus that is not a prospectus ...
Wow. You know, I saw the word "prospectus" and didn't pay any attention. It gets weirder and weirder, but:
PROHIBITION ON SALES TO EEA RETAIL INVESTORS: The Products are not intended to be offered, sold or otherwise made available to and should not be offered, sold or otherwise made available to any retail investor in the EEA. For these purposes, a retail investor means a person who is one (or more) of: (i) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU, as amended (MiFID II); (ii) a customer within the meaning of Directive 2002/92/EC, where that customer would not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II; or (iii) not a qualified investor as defined in Directive 2003/71/EC, as amended (the Prospectus Directive).
So not only is not for sale in the US, it's not for sale to retail investors within the Eurozone... and, if I understand other language correctly, not within Switzerland.

And investors do not get any of the investor protections under Swiss law:
Products issued under the Programme will be exchange traded products, which do not qualify as units of a collective investment scheme according to the relevant provisions of the Swiss Federal Act on Collective Investment Schemes (CISA), as amended, and are not licensed thereunder. Therefore, the Products are neither governed by the CISA nor supervised or approved by the Swiss Financial Market Supervisory Authority FINMA (FINMA). Accordingly, Investors do not have the benefit of the specific investor protection provided under the CISA.
Reading some of the language in it, I'm not even sure retail investors are even supposed to be see this document.

Anyway: two obvious possibilities. This really is a scam, sold only to "qualified" investors willing to sign a paper saying "we know this might be a scam and we're cool with that." Another is that it's a kind of publicity stunt--this is really just a kind of a draft proposal, they are far away from having it approved for retail sale anywhere, and but by doing this they can send out press releases and create buzz pretending that they have created the "first crypto index ETF." It's probably no closer to regulatory approval than the Winklevoss twins' COIN ETF is.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by mhalley »

I’m waiting for the 3x inverse crypto etf before I jump in.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by wolf359 »

saintsfan342000 wrote: Tue Nov 27, 2018 9:23 pm Hopefully this means that regulators will soon approve that ETF that tracks my performance at the craps table.
It doesn't look like regulators even approved this one...
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by HomerJ »

White Coat Investor wrote: Thu Nov 29, 2018 11:31 am The whole thing is just a big joke, even the name of the ETF. I feel badly for anyone putting serious money into the entire asset class.
It's amazing that you can create a fake ETF with a joke name, write in your prospectus that this not really a prospectus, list all the ways investors will probably lose money...

And STILL people will want to invest with you.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by Valuethinker »

nisiprius wrote: Thu Nov 29, 2018 12:05 pm
Valuethinker wrote: Thu Nov 29, 2018 11:25 am...BUT what it does say is that the Prospectus is not a prospectus in the meaning of the EU Prospectus directive. I guess that's to rule out the protections a member of the EU would have (Switzerland is not in the EU but a broader federation with the EU).

But it did rather send a chill down the spine -- the prospectus that is not a prospectus ...
Wow. You know, I saw the word "prospectus" and didn't pay any attention. It gets weirder and weirder, but:
PROHIBITION ON SALES TO EEA RETAIL INVESTORS: The Products are not intended to be offered, sold or otherwise made available to and should not be offered, sold or otherwise made available to any retail investor in the EEA. For these purposes, a retail investor means a person who is one (or more) of: (i) a retail client as defined in point (11) of Article 4(1) of Directive 2014/65/EU, as amended (MiFID II); (ii) a customer within the meaning of Directive 2002/92/EC, where that customer would not qualify as a professional client as defined in point (10) of Article 4(1) of MiFID II; or (iii) not a qualified investor as defined in Directive 2003/71/EC, as amended (the Prospectus Directive).
So not only is not for sale in the US, it's not for sale to retail investors within the Eurozone... and, if I understand other language correctly, not within Switzerland.
European Economic Area is the EU (28, soon to be 27) + Norway & Switzerland (from memory). Get it mixed up with EFTA. So much more than the Eurozone. *I* cannot buy this thing.

What it may mean is that this is an "accredited investment" equivalent in Switzerland (SEC term) ie high net worth and expert investors only.
And investors do not get any of the investor protections under Swiss law:
Products issued under the Programme will be exchange traded products, which do not qualify as units of a collective investment scheme according to the relevant provisions of the Swiss Federal Act on Collective Investment Schemes (CISA), as amended, and are not licensed thereunder. Therefore, the Products are neither governed by the CISA nor supervised or approved by the Swiss Financial Market Supervisory Authority FINMA (FINMA). Accordingly, Investors do not have the benefit of the specific investor protection provided under the CISA.
Reading some of the language in it, I'm not even sure retail investors are even supposed to be see this document.

Anyway: two obvious possibilities. This really is a scam, sold only to "qualified" investors willing to sign a paper saying "we know this might be a scam and we're cool with that." Another is that it's a kind of publicity stunt--this is really just a kind of a draft proposal, they are far away from having it approved for retail sale anywhere, and but by doing this they can send out press releases and create buzz pretending that they have created the "first crypto index ETF." It's probably no closer to regulatory approval than the Winklevoss twins' COIN ETF is.
When I was more involved with start-up companies they had to solicit funds from "qualified" investors (which basically meant £250k liquid assets or significant relevant professional experience eg banker or accountant).

And basically they were signing away all the usual retail financial protections.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by AndroAsc »

Wow lots of negativity on crypto here.

Comments and concerns about the legal aspects of the ETF are valid, but I don't understand what's with all the hostility against crypto as an alternative asset aka small 5-10% porfolio.

Do you own commodities like Gold? Guess what Gold has no intrinsic value, so why are you holding it? Same with crypto, the only difference is (i) there is a finite sum of crypto, so that means it's value will increase with time, as long as people "entrust" some intrinsic value to it, (ii) have a diversified crypto fund ensures that newer coins get indexed and older ones get retired, so you are not chasing coins but the entire crypto market.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by bargainhuntingking »

Wow lots of negativity on crypto here.

Comments and concerns about the legal aspects of the ETF are valid, but I don't understand what's with all the hostility against crypto as an alternative asset aka small 5-10% porfolio.

Do you own commodities like Gold? Guess what Gold has no intrinsic value, so why are you holding it? Same with crypto, the only difference is (i) there is a finite sum of crypto, so that means it's value will increase with time, as long as people "entrust" some intrinsic value to it, (ii) have a diversified crypto fund ensures that newer coins get indexed and older ones get retired, so you are not chasing coins but the entire crypto market.
Gold is finite as well. There IS a limited amount. It does have intrinsic worth as a useful metal for industrial purposes, but most people see its value as a vain symbol of wealth. I find it useful as a door stop because it's heavier than using a piece of wood or a rock, and it's a dense metal thus has a lower profile; I suggest using at least 100kg ingots to dissuade casual theft. However, I do prefer things that have intrinsic usefulness to me and my survivability such as bags of lentils, rice, clean water, clean air, shelter, and clothing/blankets for warmth, etc. more so than things that are valuable in abstract, or require others to validate their value.

Too bad no one has come up with a necklace or baseball hat with a wifi connected LCD display indicating real time updates to one's crypto account balances. That way the crypto heads could capitalize on the vanity and broadcast to the world their crypto's net value, bling, bling! What a cool status symbol/fashion accessory!
Last edited by bargainhuntingking on Fri Nov 30, 2018 2:03 am, edited 1 time in total.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by White Coat Investor »

AndroAsc wrote: Thu Nov 29, 2018 10:12 pm Wow lots of negativity on crypto here.

Comments and concerns about the legal aspects of the ETF are valid, but I don't understand what's with all the hostility against crypto as an alternative asset aka small 5-10% porfolio.

Do you own commodities like Gold? Guess what Gold has no intrinsic value, so why are you holding it? Same with crypto, the only difference is (i) there is a finite sum of crypto, so that means it's value will increase with time, as long as people "entrust" some intrinsic value to it, (ii) have a diversified crypto fund ensures that newer coins get indexed and older ones get retired, so you are not chasing coins but the entire crypto market.
No. I agree with you that gold has no intrinsic value either, just like crypto.

Who do you know spending crypto on a regular (let's say weekly) basis? No one? You know why? Because it's not a currency. So if it isn't a currency, what is it? The answer is a speculative instrument. Nobody "invests" in a speculative instrument. Some people trade it, but that's not the same thing. At best, the expected return on a currency is 0%, before costs. Maybe if you're lucky 0% real. How much of your portfolio are you going to tie up in assets with that expected return? I expect a heck of a lot less volatility for a 1-2% real return, there should be pretty much none for 0%.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by typical.investor »

Gold has a physical limitation to its quantity.

Crypto can easily be forked an infinite number of times. An infinite variety of coins can easily be constructed.

How are they equivalent?

And no I don’t speculate on gold.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by Valuethinker »

AndroAsc wrote: Thu Nov 29, 2018 10:12 pm Wow lots of negativity on crypto here.

Comments and concerns about the legal aspects of the ETF are valid, but I don't understand what's with all the hostility against crypto as an alternative asset aka small 5-10% porfolio.

Do you own commodities like Gold? Guess what Gold has no intrinsic value, so why are you holding it? Same with crypto, the only difference is (i) there is a finite sum of crypto, so that means it's value will increase with time, as long as people "entrust" some intrinsic value to it, (ii) have a diversified crypto fund ensures that newer coins get indexed and older ones get retired, so you are not chasing coins but the entire crypto market.
Rick Ferri I think called this di-worsifying.

If you buy a zero to negative return asset on 10% of your portfolio (or even 5%) it's going to have an impact on your total portfolio value. And this is an asset where you could lose the lot.

In a world where US Treasury bonds return 3%, and US stocks will most likely return something like 5-8%, that's a lot of drag.

It also underlines my thought about crypto as a phenomenon- this is a product of ultra low interest rates. The cost of carry is low so it's relatively easy to speculate. Most speculative bubbles have a connection to low nominal or real interest rates (negative real rates in particular).

Gold has the merit of a long term historical track record, a known limitation on supply (gold mined probably does not exceed gold lost by a lot). But see William Bernstein (something like "the most patient asset") on the issues vis a vis owning gold.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by fennewaldaj »

I think if one insist on having crypto as a buy and hold asset it should not be re balanced (at least not as it goes down. It would be ok to take some off the top). Its a dangerous game to re balance assets that have a realistic chance of going to zero at some point.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by nisiprius »

AndroAsc wrote: Thu Nov 29, 2018 10:12 pm Wow lots of negativity on crypto here.
This forum is devoted to

Image

"Investing Advice Inspired by Jack Bogle," and Bogle did say "Avoid bitcoin like the plague. Did I make myself clear?" Of course, I don't go along with everything Bogle says, but he is a thought leader. He said that in November, 2017 which turned out to be a good time to avoid bitcoin.
Do you own commodities like Gold?
No, I don't. Do you? I'm not sure what percentage of Bogleheads do. Direct ownership of commodities is not part of the
the Bogleheads investment philosophy, nor are collateralized commodity futures ETFs; there have been debates about it but it's not anything central.
Guess what Gold has no intrinsic value...
You should have said "almost no intrinsic value," it has real uses, but that's a quibble.
so why are you holding it?
If I were, which I am not, I'd probably say "it has value because people trust it."
Same with crypto... as long as people "entrust" some intrinsic value to it."
But they don't. As objectively as I can be, it seems to me that the amount of trust the general public has in precious metals is a lot higher than the trust they have in cryptocurrency.

1) Precious metal real-world experience: my wife found ten old silver dollars in her late folks' things. Took 'em down to a local coin shop. Got cash for them. The value paid per ounce was very close to the numbers that came up online with a Google search. No problem. People trust silver, in real life it works just as if it were valuable. So, I can exchange precious metal for dollars at a coin shop within walking distance of where I'm sitting.

2) bitcoin real-world experience: the big Boston train station had a so-called "bitcoin ATM" in it for, I think, about three months. I saw it once going through on my way to New York. Lots of publicity. A normal "ATM" dispenses physical things you can carry over to the food court and buy lunch with. I never did figure out why you'd buy your bitcoin at an "ATM" since the end result is exactly the same as buying it at home online, and since no vendor in the train station accepts bitcoin. The "automated" teller machine had a guy standing next to it to work it, it wasn't "automated" at all.

In any case, I don't know of any place within twenty miles where I can exchange bitcoin for dollars, nor for any physical goods.

(See, that's the thing about bitcoin. Nothing about what people say about it checks out. The "A"TM isn't automated, the transactions that were supposed to cost less than credit cards cost more, the anonymity isn't anonymity, the local Subway doesn't accept it, it has been double-spent, etc. etc.)
(i) there is a finite sum of crypto, so that means it's value will increase with time, as long as people "entrust" some intrinsic value to it, (ii) have a diversified crypto fund ensures that newer coins get indexed and older ones get retired, so you are not chasing coins but the entire crypto market.
You stated that it is prudent to be invested in many different kinds of cryptocurrency. If I understand, you find the HODL thingy attractive because it holds five. But as long as there's more than one kind of cryptocurrency, and as long as anyone can successfully launch new ones, how, exactly, is there any limit on the total amount of cryptocurrency?
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by hilink73 »

nisiprius wrote: Fri Nov 30, 2018 7:22 am But as long as there's more than one kind of cryptocurrency, and as long as anyone can successfully launch new ones, how, exactly, is there any limit on the total amount of cryptocurrency?
It probably depends on which currency people trust or where the mining/staking power is: currency A or currency B.
There are many chains and crypto currencies, but the big ones are there for a reason. People trust in them, otherwise there would be no miners/stakers to support these very currencies with there hashing power (stakes).

Also, yes, Bitcoin has flaws and doesn't live up to it's promises (cheap and fast payment).
But everybody is hanging themselves on Bitcoin while there are a few other, more advanced technologies. Example Ethereum. Or DAI by MakerDAO, which is pegged 1:1 to the USD (called a stable coin)... and held up quite well during this downturn (which another poster on this board lauged about a few month ago...).

Re DAI: it's quite fascinating https://coinmarketcap.com/currencies/dai/


Guys, have a great weekend.


Disclainer: not investing in any crypto "ETFs" but holding everything directly.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by RobLyons »

I would stay far, far away..


I recall a passionate discussion a coworker started with me earlier this year. I consider him to be highly intelligent and he's a very well respected leader in our field. He was pro cryptos, and was trying to convince me at length that I needed to invest heavily in cryptos. It was almost like a sales pitch. I calmly explained that it wasn't the way I chose to invest. The moment I mentioned cryptos being a bit of a speculation, he nearly lost it. I calmly excused myself from the discussion at this point and wished him best of luck.


We all know the end result. I wouldn't expect much different results here.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by MotoTrojan »

AndroAsc wrote: Tue Nov 27, 2018 9:27 pm
bargainhuntingking wrote: Tue Nov 27, 2018 9:22 pm Sounds like the Bitwise mutual fund which holds the top 10 cyptos as a % of market cap. Bitwise is a "market cap" crypto fund but since Bitcoin is such a large percentage of the cap, most of the other "alt coin" crypto are insignificant in terms of their effect on the overall fund performance. Why not just buy bitcoin directly (through Coinbase) and avoid the expense ratio? Get ready for a rollercoaster. It might be more enjoyable to just dump your money in a trashcan. I stopped speculating in 2014 after watching price fluctuations ranging from $90-1200/btc with scandal after scandal plaguing adoption, security, confiscation etc. Also, mainstream adoption never took off. It seemed like the big hoarding "whales" were pumping and dumping and massively manipulating the price of btc. I cashed out with a 5 figure loss and tax lost harvested. Yes, I was one of the few people who reported my transactions to the IRS on my 2014 return (perhaps only a couple dozen others did the same?). I put the rest of my "speculative" play money in a total stock US fund and never looked back. Good riddance!
Many reasons, it's a market-cap weight crypto fund. I have no time to rebalance, which is prob very frequent given how volatile crypto is. Also, I don't want to deal with hackers and security issues and risk all my money being drained away.

This is also not speculation. It's buy-and-hold. Like for decades... hence needed a somewhat diversified crypto fund as opposed to just BTC.
If you think you’d have to rebalance a self made market cap portfolio you’re wrong.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by pokebowl »

I would never touch this fund with a 10 foot pole, they missed the boat in timing in my opinion. That being said, I did physically laugh out loud at that ticker symbol. :beer Its hilarious how a meme that started from an accidental typo which in and of itself was memed into a pseudo acronym "Hold On for Dear Life" is now a professional symbol for a fund... :oops:
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by typical.investor »

hilink73 wrote: Fri Nov 30, 2018 5:24 pm
nisiprius wrote: Fri Nov 30, 2018 7:22 am But as long as there's more than one kind of cryptocurrency, and as long as anyone can successfully launch new ones, how, exactly, is there any limit on the total amount of cryptocurrency?
It probably depends on which currency people trust or where the mining/staking power is: currency A or currency B.
There are many chains and crypto currencies, but the big ones are there for a reason. People trust in them, otherwise there would be no miners/stakers to support these very currencies with there hashing power (stakes).
Actually there are miners because it is profitable for them to do so. Q: What happens when all the coins are mined and miners have electricity bills but no income from coins? A: We will have to enter a bidding process to get transactions executed. Read Transaction fees! It's already been a problem even with minimal bitcoin adoption for actual payments.

And what happens if China imposes particular requirements on its miners? That's 70% and effectively could control the whole bitcoin chain.

Speculate if you want. It's your money. I just think these things should be considered.

Anyway, the Reddit threads on losses (especially from alt-coins often created as solutions to various payment problems) are a really good read from a humanities perspective. Humor, camaraderie, self-realization, doubt, hope, mental-health hotline numbers -- it's all there.

At the end of the day, I think the cheapest, safest, and most efficient payment system will win. In Jan, transactions fees for bitcoin reached $25. Due to less usage, it's now down to $3. Hey great if they can put some pressure on Visa etc.., but assuming they can safely there is still the issue of safety and efficiency. Good luck.
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Re: First Crypto ETF Index Fund launched!!! $HODL

Post by hilink73 »

typical.investor wrote: Fri Nov 30, 2018 10:46 pm
hilink73 wrote: Fri Nov 30, 2018 5:24 pm
nisiprius wrote: Fri Nov 30, 2018 7:22 am But as long as there's more than one kind of cryptocurrency, and as long as anyone can successfully launch new ones, how, exactly, is there any limit on the total amount of cryptocurrency?
It probably depends on which currency people trust or where the mining/staking power is: currency A or currency B.
There are many chains and crypto currencies, but the big ones are there for a reason. People trust in them, otherwise there would be no miners/stakers to support these very currencies with there hashing power (stakes).
Actually there are miners because it is profitable for them to do so. Q: What happens when all the coins are mined and miners have electricity bills but no income from coins? A: We will have to enter a bidding process to get transactions executed. Read Transaction fees! It's already been a problem even with minimal bitcoin adoption for actual payments.

And what happens if China imposes particular requirements on its miners? That's 70% and effectively could control the whole bitcoin chain.

Speculate if you want. It's your money. I just think these things should be considered.

Anyway, the Reddit threads on losses (especially from alt-coins often created as solutions to various payment problems) are a really good read from a humanities perspective. Humor, camaraderie, self-realization, doubt, hope, mental-health hotline numbers -- it's all there.

At the end of the day, I think the cheapest, safest, and most efficient payment system will win. In Jan, transactions fees for bitcoin reached $25. Due to less usage, it's now down to $3. Hey great if they can put some pressure on Visa etc.., but assuming they can safely there is still the issue of safety and efficiency. Good luck.
Yes, we had that Bitcoin discussion here ad nauseam.
It's all known and gets boring. But who cares about Bitcoin anyway (besides it's still the #1 coin).


Maybe we should talk about the interesting projects. For example the one I mentioned.
But anyway. I know it's speculation at this point, because you cannot fix a realistic price on the Ethereum network at the moment.
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