Today marks another special day for bridging the gap between crypto investing and the traditional stock market. As the Valkyrie Capital Bitcoin Miners ETF (NASDAQ:WGMI) begins trading, investors have yet another chance to test the waters of a profound new space. Where other exchange-traded funds (ETFs) and trusts boast portfolios of futures contracts and “Bitcoin (CCC:BTC-USD) adjacent” stocks, though, the WGMI ETF offers something different.
Since the launch of the ProShares Bitcoin Strategy ETF (NYSEARCA:BITO) in October 2021, investors have been bearing witness to a whole slew of new funds related to cryptocurrency. So far, regulators haven’t given a green light to a fund that holds Bitcoin directly. This means that the ETFs on the market trade BTC futures contracts or stocks of companies that hold Bitcoin.
The Valkyrie Bitcoin Miners ETF is the newest addition to this inflow of new funds. But how does it aim to offer something different? Here’s what you need to know.
WGMI ETF Brings Dedicated Mining Fund to Wall Street
- It’s worth noting that Valkyrie Capital is not new to the Bitcoin ETF crowd. The WGMI ETF will be Valkyrie’s third Bitcoin ETF. Previously, it launched the Bitcoin Strategy ETF (NASDAQ:BTF) and the Balance Sheet Opportunities ETF (NASDAQ:VBB). BTF trades Bitcoin futures contracts, while VBB trades stocks of companies which have Bitcoin on their balance sheets.
- WGMI is the company’s venture specifically into the increasingly lucrative world of Bitcoin mining. Indeed, the fund holds stocks in publicly traded crypto miners. According to its filing with the Securities and Exchange Commission, the fund will “invest at least 80% of its net assets in securities of companies that derive at least 50% of their revenue or profits from bitcoin mining operations.”
- The other 20% of the portfolio will be invested in companies with Bitcoin holdings or producers of mining equipment.
- The Valkyrie Miners ETF is an actively traded fund, as most other Bitcoin-centric ETFs are. It comes with an expense ratio of 0.75%, or $75 on an initial $10,000 investment.
- After filing in late January, the WGMI ETF saw approval for listing just yesterday. The fund, like other Valkyrie ETFs, is listing on the Nasdaq Exchange.
- Among the list of notable mining plays are Greenidge Generation (NASDAQ:GREE), Marathon Digital (NASDAQ:MARA), Hive Mining (NASDAQ:HIVE), Hut 8 Mining (NASDAQ:HUT) and Stronghold Digital (NASDAQ:SDIG). Several mining tech manufacturers are present on the portfolio as well, like Advanced Micro Devices (NASDAQ:AMD) and Nvidia (NASDAQ:NVDA).
- As the fund reaches the Nasdaq this morning, shares are trading at a price of $26.
On the date of publication, Brenden Rearick did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.