As if Coinbase wasn’t making enough money already ($2.7M/day right now – source), they’ve found a brand new way to open up an additional revenue stream – their own index fund. The announcement was made on the Coinbase blog today, the new fund will give investors exposure to everything on Coinbase, weighted by market cap.
The announcement was pretty darn short, here’s the whole thing:
Coinbase Index Fund will give investors exposure to all digital assets listed on Coinbase’s exchange, GDAX, weighted by market capitalization. If a new asset is listed on the exchange, it will be automatically added to the fund.
Index funds have changed the way that many people think about investing. By providing diversified exposure to a broad range of assets, index funds enable investors to track the performance of an entire asset class, rather than having to select individual assets. We’re excited to give our customers the ability to invest in the potential of blockchain-based digital assets as a whole.
At this stage, investing in Coinbase Index Fund will only be available to US-resident, accredited investors. We’re working on launching more funds which are available to all investors and cover a broader range of digital assets. (Source – Coinbase Blog)
While it’s safe to say that a ton of traditional stock market investors would love to invest in the Coinbase Index Fund, it’s only available to accredited investors at the moment. Like they said in the last sentence of their announcement, they are planning on launching additional funds that are available to all investors…and cover a larger range of digital assets.
I think this is only the beginning when it comes to cryptocurrency index funds, but when a company like Coinbase makes a move like this, everyone will watch to see what happens. Of course, you have to believe that these are the early days of cryptocurrency and much bigger and brighter futures are head. While you can argue one side or the other, the reality is nobody has a crystal ball with the answers.
What do you think? Are cryptocurrency-focused index funds a new and growing trend or is this a one time moment of insanity and soon to fizzle out and go the way of the dodo? I want to hear from you, comment and let your voice be heard!